Account Aggregator System

The account aggregator system in banking has started with eight of India’s largest banks including HDFC, ICICI, SBI, AXIS bank, IDFC first, Kotak Mahindra, Indusind and Federal Bank. Neo bank Fi has also joined the AA system and become one of the first fintech firms to do so. An account Aggregator is a non bank financial company engaged in the business of retrieving and collecting financial information pertaining to its costumers.
                                                                 It has a three tier system: Account Aggregator (AA) Financial information provider (FIP) and Financial information user (FIU). FIP hold consumer data and can be a bank or any other entity which has received the license from RBI for the same. FIU consumes the data for any kind of financial purpose and can be a bank or any other entity which has received license from the RBI for the same. Th new system makes it possible for financial institutions to understand the specific needs of different consumers according to their data provided and serve them better. It will also help citizen to easily share their financial data.
                                                             The AA system was created through inter regulator bodies i.e Reserve Bank of India(RBI), Securities Exchange Board of India(SEBI), Insurance Regulatory and developmental Authority of India(IRDAI), Pension Fund Regulatory and Development Authority India(PFRDAI) through Fiscal Stability and Development Council (FSDC) headed by Union Finance Minister.

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