Account Aggregator Network- a financial data-sharing system
India unveiled the Account Aggregator (AA) network, a financial data-sharing system that could revolutionize investing and credit, giving millions of consumers greater access and control over their financial records and expanding the potential pool of customers for lenders and fintech companies. Account Aggregator empowers the individual with control over their personal financial data, which otherwise remains in silos.
What is an Account Aggregator?
- An Account Aggregator (AA) is a type of RBI regulated entity (with an NBFC-AA license) that helps an individual securely and digitally access and share information from one financial institution they have an account with to any other regulated financial institution in the AA network. Data cannot be shared without the consent of the individual.
- There will be many Account Aggregators an individual can choose between.
- Account Aggregator replaces the long terms and conditions form of ‘blank cheque’ acceptance with a granular, step by step permission and control for each use of your data.
- This is the first step towards bringing open banking in India and empowering millions of customers to digitally access and share their financial data across institutions in a secure and efficient manner.
- The Account Aggregator system in banking has been started off with eight of India's largest banks. The Account Aggregator system can make lending and wealth management a lot faster and cheaper.
- India's financial system involves many hassles for consumers today -- sharing physical signed and scanned copies of bank statements, running around to notarise or stamp documents, or having to share your personal username and password to give your financial history to a third party. The Account Aggregator network would replace all these with a simple, mobile-based, simple, and safe digital data access & sharing process. This will create opportunities for new kinds of services -- eg new types of loans.
- The individual's bank just needs to join the Account Aggregator network. Eight banks already have -- four are already sharing data based on consent (Axis, ICICI, HDFC, and IndusInd Banks) and four are going to be able to shortly (State Bank of India, Kotak Mahindra Bank, IDFC First Bank, and Federal Bank).
- Account Aggregators cannot see the personal data; they merely take it from one financial institution to another based on an individual's direction and consent. Contrary to the name, they cannot 'aggregate' your data. AAs are not like technology companies which aggregate your data and create detailed profiles of you.
- A customer can register with any AA to access data from any bank on the network.