Fintech infrastructure specialist Setu's subsidiary Agya Technologies has received an in-principal approval from the Reserve Bank of India (RBI) to operate as an account aggregator (AA).
The approval, which was received on July 4, will allow the company to launch its own AA platform. Earlier the company had built the interface for Onemoney which is a licensed AA and was one of the first to release an app.
"Fintech 1.0 was powered by Aadhaar, eKYC, and eSign; 2.0 was powered by the Unified Payments Interface (UPI). Fintech 3.0 will be powered by the Account Aggregator ecosystem for open banking," Nikhil Kumar, co-founder and Chief Evangelist at Setu, said.
"We have built a world-class API infrastructure platform that will allow every financial institution to become part of the AA ecosystem and grow with it."
The AA licence was one of Setu's key offerings during its sale to merchant payments and lending platform Pine Labs, besides its growth plans for the Open Network for Digital Commerce (ONDC) space and Open Credit Enablement Network (OCEN) framework.
AAs enable the free and instant exchange of financial data between the Financial Information Providers (FIPs) like banks, AMCs, pension funds, among others and Financial Information Users (FIUs) entities that consume this data.
The information exchange is executed with due consent from customers, in a safe and secure manner, and the AA is data blind as it receives only encrypted data. The AA framework is built to help Indian consumers avail of financial services such as loans, insurance etc. in a faster, cheaper, and more convenient manner.
The move will also benefit Pine Labs, which acquired Setu on June 23 for $70-75 million. The company is growing its lending and online payments offerings and an in-house AA platform will make it easier for it to onboard customers and extend credit.
Other players that have received in-principal approval from RBI include UPI leader PhonePe, CRIF Connect, Dashboard Account Aggregation Services, Digio Internet, NSDL E-Governance, Tally and Unacores AA Solutions.
Currently, 51 financial institutions including banks, non-banking financial companies (NBFCs), investment advisors, stock brokers and insurers are live as FIPs and FIUs. The ecosystem is eagerly awaiting the State Bank of India (SBI) to go live as it makes up the largest share of savings accounts in the country and will give a boost to data sharing.
As of last week, a total of 8.19 lakh customer accounts have been linked to the AA ecosystem and 7.61 lakh consent requests have been fulfilled, as per data by Sahamati, the not-for-profit self-organised collective for the AA ecosystem.
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