Account Aggregator Transactions Climb As Network Enables Over A Billion Accounts

With over a billion accounts, 17 banks, and 48 non-bank financial companies enabled on the account aggregator network, the open banking information layer appears to be picking up traction.

Perfios Account Aggregation Services Ltd., one of the six AAs granted an operating license by the central bank, has climbed from processing 10,000 queries in an entire month earlier this year, to processing 10,000 in a day, according to Srikant Rajagopalan, the company's chief executive officer.

Introduced by the Reserve Bank of India in 2016, the AA framework enables an RBI-regulated entity—with an NBFC-AA license—to facilitate the sharing of consensual data from individuals between financial institutions.

For example, when seeking a loan from a bank that a user doesn't have an account with, they can give their consent to the potential lender to review their financial information held with other banks, insurance providers, and others.

The AA network was launched in September 2021 and has since been joined by scores of financial services companies, both seeking—and willing to share—financial information.

"You can say about 80-85% of the bank accounts are there on AA," said BG Mahesh, co-founder of Sahamati, an industry alliance for the AA ecosystem. Accounts with only one owner have been onboarded and the others like joint accounts or corporate accounts are expected to go live in the next few months, he said.

A host of other financial services firms like insurance providers, stock brokers and investment advisors have also joined the network.

Earlier in August, the Securities and Exchange Board of India also announced that it has joined the RBI's AA network. The markets regulator is expected to go live on the network by the end of the year, Mahesh said.

We "feel good about the supply side of data", Rajagopalan said, while addressing a session at the annual banking conference organised by FICCI and Indian Banks' Association in Mumbai last week. "Early adoption is coming from retail lending," he said.

Since goods and services tax data is yet to be connected to the AA network and corporate accounts are yet to go live, the early offtake of AA has been in consumer lending related queries enabled by the network.

"GST is on the way and will hopefully, by the end of this month or in December, it will go live," Mahesh said.

Once that happens, the demand dynamics on AA will change with cash flow-based lending to enterprises emerging as an opportunity enabled by the network, he said.