The whole world is talking about transparency, while data is accessed by the Big Four companies (Google, Microsoft, Amazon and Meta) virtually and used widely, invading your privacy. Mukesh Ambani said, “Data is the new oil,” years ago.Some say data is currency. Enormous data is available with the government, and agencies misuse it. But access to information is becoming difficult for the public. The Right to Information Act is diluted. Digital Personal Data Protection Act 2023 is to taking away whatever little was available. It’s time to introspect and make corrections.
In the banking sector, the RBI Act, 1934, amended many times, Section 45, provides the power to the RBI to collect enormous data from banks and non-banking finance companies. This data can reach the government in many ways. But the RBI is not supposed to share this information with the public, who actually own the bank by depositing their money—without which banks can’t survive. The same Section 45 prevents the RBI as well as banks from sharing information about their customers. It is essential to have this secrecy clause for the depositors. No one should know who deposited how much.
45B. Power of Bank to collect credit information.—The Bank may— (a) collect, in such manner as it may think fit, credit information from banking companies; and (b) furnish such information to any banking company in accordance with the provisions of section 45D. 45C. Power to call for returns containing credit information.—(1) For the purpose of enabling the Bank to discharge its functions under this Chapter, it may at any time direct any banking company to submit to it such statements relating to such credit information and in such form and within such time as may be specified by the Bank from time to time. (2) A banking company shall, notwithstanding anything to the contrary contained in any law for the time being in force on in any instrument regulating the constitution thereof or in any agreement executed by it, relating to the secrecy of its dealings with its constituents, be bound to comply with any direction issued under sub-section (1).
45.E. Disclosure of information prohibited.—(1) Any credit information contained in any statement submitted by a banking company under section 45C or furnished by the Bank to any banking company under section 45D, shall be treated as confidential and shall not, except for the purposes of this Chapter, be published or otherwise disclosed. (2) Nothing in this section shall apply to— (a) the disclosure by any banking company, with the previous permission of the Bank, of any information furnished to the Bank under section 45C; (b) the publication by the Bank, if it considers necessary in the public interest so to do, of any information collected by it under section 45C, in such consolidated form as it may think fit without disclosing the name of any banking company or its borrowers; 2 [(c) the disclosure or publication by the banking company or by the Bank of any credit information to any other banking company or in accordance with the practice and usage customary among bankers or as permitted or required under any other law; 3 [(d) the disclosures of any credit information under the Credit Information Companies (Regulation) Act, 2005 (30 of 2005):] and the Provided that any credit information received by a banking company under this clause shall not be published except in accordance with the practice and usage customary among bankers or as permitted or required under any other law.] (3) Notwithstanding anything contained in any law for the time being in force, no court, tribunal or other authority shall compel the Bank or any banking company to produce or to give inspection of any statement submitted by that banking company under section 45C or to disclose any credit information furnished by the Bank to that banking company under section 45 D.
But what about the names of the defaulters? What about the names of corporate borrowers who are given above Rs. 10 crores credit at cheap interest—like less than 5%? (449 last year borrowers were awarded loans above 100 crores at less than 5%). Why should the depositor not know the names of “these poor people” who get cheap-rate loans, while their own children pay 11% interest for education loans?
The banks provide the data of education loan borrowers to recovery agents and asset reconstruction companies. There, no privacy or secrecy clause comes into effect. The RBI could publish the names of the 12 biggest loan defaulters—under what power could they do it? There is an urgent need to amend the RBI Act and the Banking Regulation Act to provide data on large borrowers who are defaulters.
Now, the RBI provides only the names of wilful defaulters after a Supreme Court order. The RBI should also have a relook at the Code of Ethics for banks, which talks about secrecy. The wilful defaulters are not even 5% of the total defaulters. Now, the proposed DPDP Act can pave the way for stopping even the disclosure of the list of willful defaulters. Willful defaulters are those who have money to pay but do not pay. To declare them, the bank has to file a police case, report a fraud, and follow so many procedures. No borrower will say, “I have money, but I will not pay.” He will say he made a loss and is not able to pay. That’s why the majority of the defaulters are not declared as wilful defaulters. This also requires a relook.
The DPDP Act takes away the provisions of the Right to Information Act. In the name of privacy and protection, it protects the officials from getting caught even if they commit fraud. For example, in an MGNREGA fraud, the officials who committed the frauds may be protected by not disclosing their names in the name of privacy. When they are public servants, their names should be provided under RTI to prevent others from doing the same. Similarly, if a borrower who has cheated the bank is protected under secrecy or privacy, he will go to another bank and commit a similar fraud. What this country needs is protection for journalists who expose politicians and officials who are defrauding. What this country needs is protection for citizens who question these authorities rightfully. What this country needs is protection for bankers who are getting beaten for wrong reasons. No protection for looters.
Protection should not be for looters.
Privacy is needed for honest people who perform their jobs and protect the Constitution. Privacy is needed for women who are abused every day. Privacy is needed for tribals, Dalits, and minorities who are targeted every day. It’s time to stand up.
PRIVACY PROTECTION SHOULD NOT BE FOR CRIMINALS!
It’s time to protest. It’s time for mass action.
Thomas Franco is the former General Secretary of the All India Bank Officers’ Confederation and a Steering Committee Member at the Global Labour University.
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