What is an Account Aggregator (AA) in the Indian financial system, and how does it work? What are the key benefits for individuals and businesses, and how does it ensure data privacy and security?
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Account aggregator is a framework regulated by the Reserve Bank of India (RBI) to help individual to digitally access their financial data from one financial institution they have an account ( called a Financial Information Provider) to any other regulated financial institution ( called a Financial Information User, or FIU) in the AA network, once the user gives permission.
Example:
If you are applying for bank loan and instead of providing various documents with bank you just give consent to bank to access this information digitally from your banks, mutual fund houses, insurance providers, etc. faster and efficiently.
Key Benefits-
- Full Control – You choose who gets access to your financial data and for how long.
- Improved Access to Credit – Makes it easier and faster for individuals and small businesses to get loans.
- Faster Approvals – Speeds up financial services like loan applications, wealth management, and insurance.
- Paperless & Efficient – Eliminates the need to upload or submit physical documents.