Securing Multilingual Data: Navigating India’s Data Protection Regulations in Banking and Payments

Introduction

India’s banking and payments ecosystem is expanding at an unprecedented pace, fuelled by digital adoption, UPI growth, and financial inclusion initiatives. This has resulted in expanded access with millions of users, many of whom are engaging in their native languages, are now part of the financial system. This multilingual approach brings both opportunity and complexity. Sensitive personal and financial data such as names, addresses, identification documents, and transaction records, are now being captured, stored, and processed across multiple scripts and formats.

As multilingual data flows across systems and languages, managing and securing it becomes critical from a regulatory standpoint. From ensuring accuracy in data classification to protecting against fraud and meeting evolving regulatory mandates, securing multilingual data is a strategic imperative for every financial institution. The introduction of the Digital Personal Data Protection Act (DPDPA), 2023 and its evolving rules in 2025 marks a significant shift in how personal data must be handled, especially in sectors like banking and payments where trust and compliance are paramount.

Regulations governing multilingual data

India’s regulatory framework for data protection and governance has evolved significantly in response to the digital transformation of the BFSI sector. With the proliferation of multilingual data across banking apps, fintech platforms, and payment systems, regulators have introduced stringent norms to ensure secure, transparent, and compliant data practices.

Digital Personal Data Protection (DPDP) Act, 2023

The DPDP Act, 2023 is the cornerstone of India’s data protection regime. It applies to all entities processing digital personal data, including banks, NBFCs, insurers, and fintechs. Key provisions relevant to multilingual data include:

• Multilingual Consent Notices: Financial institutions must provide privacy notices and consent forms in English and one of the 22 Indian languages listed in the Eighth Schedule of the Constitution. This ensures accessibility and informed consent across linguistic demographics.
• Purpose Limitation and Data Minimization: Data collected in regional languages (e.g., Aadhaar in Devanagari or PAN in Tamil) must be used only for the stated purpose and deleted once that purpose is fulfilled. Repurposing multilingual data for marketing or analytics requires fresh consent.
• Data Retention and Erasure: Institutions must implement language-aware data retention policies, ensuring that all customer data including multilingual datasets are securely stored and erased when no longer needed, unless mandated by laws like PMLA or RBI guidelines.

• Significant Data Fiduciaries (SDFs): BFSI entities handling large volumes of multilingual data may be classified as SDFs, requiring appointment of Data Protection Officers (DPOs), conducting Data Protection Impact Assessments (DPIAs) and maintaining multilingual audit trails and breach logs.

RBI’s Data Localization and Storage Guidelines

The Reserve Bank of India (RBI) mandates that all payment system data be stored exclusively in India, regardless of language or format while also requiring payment service providers to maintain network and application architecture diagrams showing multilingual data flows. For cross-border transactions, only the domestic component may be stored abroad temporarily. All data must be brought back and stored in India within 24 hours of processing. This applies to multilingual data processed via global cloud providers or translation APIs.

CERT-In and MeitY Guidelines

The Indian Computer Emergency Response Team (CERT-In) and the Ministry of Electronics and Information Technology (MeitY) require all institutions including those operating in BFSI sector to set up Cyber Hygiene and Training that involves training staff to recognize phishing and fraud in regional languages and implement multilingual cybersecurity awareness programs.

Conclusion

As India’s financial ecosystem continues to digitize and embrace linguistic diversity, the protection of multilingual data is no longer a peripheral concern. It is central to regulatory compliance, customer trust, and operational resilience. Enterprises must proactively adapt their governance frameworks to account for language-specific risks, consent management, and secure data flows across regional touchpoints. As the regulatory landscape continues to evolve, organizations that embed language-aware data governance into their security architecture will be better positioned to lead in compliance, innovation, and customer-centricity.