View: Private data as public business? Financial services need a clean-up act

Everything in life is a compromise and to my mind, catching tax cheats is the kind of thing that makes Aadhaar a more than acceptable trade-off. By Dhirendra Kumar CEO, Value Research

If the Supreme Court’s elevation of privacy to a fundamental right is followed through in spirit, then the selling of financial services in India will have to change. Compared to all other industries, it is the financial services industries that seem to base their sales efforts heavily on widespread abuse of personal information of their customers to which they are privy. The contempt with which customers’ financial data is treated has facilitated a widespread crime wave in which older and less tech-savvy people are subjected to digital robberies of their bank accounts.

Of course, if one were to believe the general tone of news in the media, the highest court’s judgement was about Aadhaar, and about the link between Aadhaar and paying taxes. I’m in favour for the link between Aadhaar and income tax.

Earlier, one would see a lot of people being mildly concerned about the possible privacy violations that might arise from the link between Aadhaar and direct cash benefits or MNREGA or things like that. You know, the kind of stuff that concerns those other kind of people. And then came the link of Aadhaar with PAN numbers and income tax returns and all hell broke loose. Overnight, it seemed, a huge number of people realised Aadhaar was a privacy violation. All kinds of powerful people starting dedicating time to fighting this assault on privacy.

Honestly, I have never seen this class of people being so deeply concerned about a public issue. It’s commendable. Everything in life is a compromise and to my mind, catching tax cheats is the kind of thing that makes Aadhaar a more than acceptable trade-off.

Coming back to real data and privacy issues, it has now been pretty clear to everyone who has a bank account that all your details are casually handed over to anyone who is selling any kind of financial product. A few months ago, I wrote about a case where an old couple’s money was transferred by a gang of criminals who knew details of their insurance policies and were thus able to convince the victims that they were actual insurance advisors. After solving the case, police found that the gang had a database of such details for thousands of people.

In its judgement, the Supreme Court stated that informational privacy is a facet of the right to privacy. The dangers to privacy in an age of information can originate not only from the state but from non-state actors as well. We commend to the Union government the need to examine and put into place a robust regime for data protection…’. Legal experts say the actual law and practice will evolve as individuals come forward and claim that their right to privacy is being violated by some action that someone else is taking.

Can someone file such a case the next time they get a call from a personal loan or insurance telemarketer who is privy to more data than they should? The days of playing fast and loose with customers data will come to an end at some point soon. One interesting legal opinion I came across is that even if the customer agreement of a bank or an insurance company has clauses that are worded to allow them to violate your privacy and share your data, such contracts cannot override a fundamental right that the constitution gives you.

Perhaps it’s time that those addicted to violating others’ privacy to further their own business interests should start thinking of some new strategies.

(Views expressed by the author are personal.)

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