Data Governance Guidance Framework for Banks
Prelims:
Indian
Economy, Governance
Mains:
GS
Paper III: Indian Economy, Banking Sector, Digital Economy, Cyber Security,
Data Governance
Current relevance:
The Reserve Bank of India (RBI) has issued the Guidance
on Regulatory Expectations for Data Governance for banks and other
Regulated Entities (REs).
Highlights:
Data Governance Guidance Framework (DGF)
1. It is a regulatory framework issued
by the RBI that prescribes standards for the effective governance,
management, protection, and utilisation of data by banks and other Regulated
Entities (REs).
Need for Data Governance:
1. The rapid digital transformation of the
banking sector has made data a critical asset for banks.
2.
The
growing scale, diversity, and complexity of data require robust
governance practices to ensure its quality, integrity, and security.
3. Inadequate data governance can increase operational,
financial, regulatory, and reputational risks for banks and other regulated
entities.
4. The framework enables compliance with
the Digital Personal Data Protection (DPDP) Act, 2023, and other
applicable legal and regulatory requirements.
Key Features
of the Framework:
1.
Comprehensive
Data Governance Framework
(DGF)
Every Regulated
Entity (RE) is required to establish a DGF that is integrated with its overall
risk management framework.
2.
Risk-Based
and Proportionate Approach
The framework
should be designed in proportion to the institution's size, operational
complexity, business model, and technological capabilities.
3.
End-to-End
Data Lifecycle Management
The DGF should
govern the entire data lifecycle, including data creation, collection, storage,
processing, sharing, retention, and secure disposal.
4.
Robust
Institutional Governance
Define clear organisational structures,
governance policies, roles and responsibilities, operational processes,
technology systems, and audit mechanisms.
5.
Periodic
Review and Updation
Banks
are required to review and update the Data Governance Framework atleast
annually or more frequently.
Source: THE HINDU - https://www.pressreader.com/india/the-hindudelhi9ww5/20260716/282123528271454?srsltid=AfmBOoqv7f8RMxKtWzLjwoSFZSsIDXGWOZpNys0XAkdTTvE8qwvUUnlj