Laying emphasis on the importance of data privacy and on safeguarding client data, finance minister Nirmala Sitharaman said India has the highest fintech adoption rate as compared to a much lower global average.
Speaking at a fintech conference on Tuesday, Sitharaman said the value of digital transactions has jumped to Rs 6 trillion in January-August 2021 from Rs 4 trillion last year and Rs 2 trillion in 2019.
“Data privacy is very important and it is an issue on which there can be a lot of contentious views. However, basic respect for privacy as the guiding principle is well appreciated,” said Sitharaman while addressing the ‘Global FinTech Fest 2021.’
She added that safeguard of client data is the backbone to bringing trust. “Unless my data is safeguarded, I wouldn’t want to get into a scheme of things. So, that is the guiding principle,” the Union minister added.
Fintech adoption rate is 87 per cent in India, as against the global average of 64 per cent, she said. “I think India is the prime destination for digital activities and digital payments,” the FM added.
Sitharaman also released the report ‘UN principles for responsible digital payments’ which outlines guiding principles for the government, users and the industry. The report pointed out that nearly one in three digital payments users in India has been a recent victim of digital fraud and this remains the biggest concern.
“Ransom payments increased by 33 per cent in Q1 of 2020, with attackers taking advantage of the increased socioeconomic disruption during Covid,” the report said. This threat also extends to businesses, whose systems are susceptible to hacking and breakdowns. Nearly 60 per cent of organisations experienced some form of fraud in 2020, having grown 50 per cent over a three-year period, it added.
The report also highlighted that when digital payments in India increased, following the outbreak of Covid-19, time-out failures also increased from 3 per cent to 12 per cent. “As a result, users were unable to access their funds when they needed them. Yet worse, some found their funds stuck in limbo where neither the payer nor the intended payee could access them,” the report said.
“I am very impressed that today the UN principles for responsible digital payments are being launched. It is the need of the hour. We need to understand that in our desire to bring in an interoperable system, we shouldn’t be in a hurry to compromise on any one of these features,” she said.