As part of a larger effort to improve digital privacy protection, the Union Home Ministry has reportedly ordered fintech and consumer tech companies to stop gaining illegal access to people’s PAN data. Media was informed by people with knowledge of the situation.
According to reports, the Indian Cybercrime Coordination Centre (14C) is leading the crackdown on “PAN enrichment” services, which businesses have been utilising to obtain people’s identities, addresses, and phone numbers via the backend systems of the Income Tax agency.
These unapproved services have experienced difficulties in recent weeks, according to several industry executives who spoke to the media on condition of anonymity. The action was taken as the government is ready to implement the disruptions caused by digital personal technology over the past several weeks. The action was taken in anticipation of the Digital Personal Data Protection Act, 2023 (DPDP) being put into effect by the government.
“Most consumer lending platforms and credit aggregators used this unauthorised service extensively,” a senior fintech executive who requested anonymity told the media.
The practice, while not a data leak, represented unauthorised usage of the Income Tax Department’s backend systems managed by technology service providers.
There is no impact on the National Securities Depository’s (NSDL) authentic PAN verification service. Without disclosing personal information, this authorised channel just verifies that the information submitted matches their database.
As previously reported by the media, this endeavour comes after the National Payments Corporation of India recently took action to stop unauthorised access to UPI handle data.
According to industry analysts, these actions are in line with the government’s larger plan to implement data protection laws. “After the Supreme Court judgement on Aadhaar, the rules around database access became more formalised. The government is now extending this to all government databases,” another industry executive noted.
Industry participants agree that the crackdown will help standardise data protection procedures prior to the DPDP Act’s adoption, notwithstanding the possibility of short-term interruptions.
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