Participation in Account Aggregator Framework

IRDAI vide Circular Ref: IRDAI/IID/CIR/MISC/229/11/2022 has issued a Circular on Participation in Account Aggregator Framework dated November 14, 2022 (Circular) and has provided guidance on the participation of Indian Insurance Companies and Insurance Repositories in the RBI’s account aggregator framework

Background

RBI’s Master Direction on “Non-Banking Financial Company – Account Aggregator (Reserve Bank) Directions 2016” dated September 2, 2016 (Master Direction) provided a framework for the registration and operation of Account Aggregators (AA) in India, which defines Account Aggregator and Financial Information Provider as follows:

• “ Account Aggregator is Non-Banking Finance Company that provides service of retrieving or collecting financial information from Financial Information Providers (FIP) pertaining to a customer and consolidating, organizing and presenting such information to the customer or any other Financial Information User (FIU), on the basis of explicit consent of the customer .”
• “Financial information provider” means bank, banking company, non-banking financial company, asset management company, depository, depository participant, insurance company, insurance repository, pension fund and such other entity as may be identified by the Bank for the purposes of these directions, from time to time;

In view of the above Financial Information Provider includes Insurance Company and Insurance Repository.

Accordingly IRDAI has issued following directions to Financial Information Providers (FIP) in the insurance sector:

• To share the “Financial Information”, as defined in para 3(1)(ix) of the Master Direction to the customers and Financial Information Users (FIU), through AAs registered with the RBI .
• To enter into a contractual framework with AAs, which will “distinctly” specify:

(i) the rights and obligations of each party, and

(ii) the modalities of the dispute resolution mechanism.

• To adopt the “technical specifications” published by the Reserve Bank Information Technology Private Limited (ReBIT), as updated, and adopt the required information technology framework to ensure secure flow of data to AA.
• To build adequate safeguards in IT systems to ensure that data is protected against unauthorized access, alteration, destruction, disclosure or dissemination of records and data .
• To abide by the code of conduct as specified in the IRDAI Act/regulations/guidelines/circulars applicable to them, including redressal of grievances of the customers .
• To disclose “prominently” on their websites the names of AAs through which financial information will be shared to customers and FIUs.

Source category: IRDAI

Attachments

• /2022/108_2022-11-14_Participation_in_Account_Aggregator_Framework.pdf