RBI Cyber Security Guidelines for NBFCs: Ensuring Data Protection & Compliance

Increasingly, cyber threats and attacks originating in internal or external sources are targeting not only banks but also nonbank financial companies. In order to address this issue, guidelines and regulations for NBFCs have been established by regulatory authorities such as the Reserve Bank of India RBI and National Housing Bank to ensure that financial transactions and customer data are safe. These guidelines are applicable to any banking, neo-banking, credit, and other financial institution in India. In order to ensure cyber security preparedness, the RBI Guidelines on Cyber Security Framework were issued on 2 June 2016, pointing out that information security controls, policies, and regular 3rd party audits are important.

In order to safeguard from cyber threats and mitigate the risk of damage to reputation, data breaches, or financial loss, NBFCs are advised to adopt an information technology framework set up by RBI and NHB. These guidelines require NBFCs to set up a proper policy framework with enhanced monitoring of accounts that may be terrorists linked and swift identification of transactions.