The new Privacy Enhancing Technologies (PETs) can transform the BFSI sector in India under the Digital Personal Data Protection Act 2023. With BFSI handling highly sensitive financial data, compliance is not just regulatory—it’s a cornerstone of trust and reputation.
The Digital Personal Data Protection Act mandates principles like purpose limitation, data minimization, and storage limitation while granting individuals rights such as access, correction, and erasure.
Balancing these requirements with the sector’s need for fraud detection, risk assessment, and personalized services is challenging.
This is where PETs (Privacy Enhancing Technologies) step in—offering secure methods to analyze and process data without exposing personal information.
Drawing lessons from the EU’s GDPR-driven initiatives, we see banks adopting:
• Homomorphic Encryption for collaborative fraud analysis
• Differential Privacy for anonymized regulatory reporting
• Secure Multi-Party Computation for joint risk assessments
• Federated Learning for privacy-preserving credit scoring
Homomorphic Encryption, Differential Privacy, Federated Learning, SMPC, and Zero-Knowledge Proofs—technologies are vital for the future of secure and compliant BFSI operations in India.
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