The Digital Personal Data Protection Act: A Leap towards Building Trust in the Digital Economy
By Sandeep Kadam, CTO – Kissht
The Digital Personal Data Protection (DPDP) Act is poised to reshape the digital landscape in India. With the final draft rules receiving the home ministry’s approval, the Act is now one step closer to implementation. This development marks a critical turning point in how personal data will be managed, safeguarded, and regulated across industries.
Data privacy has long been a growing concern for both consumers and businesses in India. The rapid digitalization of services—ranging from financial transactions to e-commerce—has brought unprecedented data collection. However, the lack of a structured regulatory framework has often left users vulnerable to data misuse and privacy breaches. The DPDP Act seeks to address these challenges by establishing clear guidelines for data usage, consent mechanisms, and accountability.
With India becoming one of the world’s largest digital economies, this legislation is a critical step toward building trust between service providers and users. It aims to ensure that individuals retain ownership of their personal data, while businesses operate within a framework that promotes transparency, compliance, and security.
- Empowering Consumers with Data Ownership
The DPDP Act shifts the balance of power by giving consumers greater control over their personal data. The ability to choose how their data is used, request its deletion, and understand the purpose of data collection is a transformative change. This transparency not only protects users’ privacy but also fosters trust between consumers and service providers.
According to a report by think tank Data Security Council of India (DSCI), India detected an average of 761 cyberattack attempts per minute in 2024. In a world where data breaches and misuse are on the rise, this move ensures that consumers are no longer passive participants in the digital economy. Instead, they are empowered data principals, capable of making informed decisions about their personal information.
- A Boon for Businesses: Building Trust as a Competitive Edge
For businesses, compliance with the DPDP Act is more than just a regulatory requirement—it’s an opportunity to build trust as a competitive advantage. In a digital-first world, trust is currency. Companies that prioritize data privacy and security will stand out, fostering stronger customer relationships and ensuring long-term growth.
Moreover, aligning with the Act’s requirements will lead to better data hygiene practices. Data minimization and purpose limitation ensure that businesses collect only what’s necessary, reducing the risk of data misuse and enhancing operational efficiency.
A strong regularity framework also positions the country’s digital finance landscape as a trustworthy industry, building investor confidence in India and globally.
- Compliance Timelines: A Thoughtful Transition Period
The Act provides an 18 to 24 month transition period, allowing businesses sufficient time to adapt to new consent mechanisms and data handling procedures. This phased approach ensures that companies can make systematic changes to align with the new framework without operational disruptions.
This timeline also mirrors global best practices, providing a level playing field for Indian businesses to compete in the international market.
- Addressing Concerns around Compliance Costs
While some companies might view compliance as an additional cost, it’s important to see it as an investment in long-term brand reputation. Companies that proactively implement robust data protection policies will gain a first-mover advantage in a market increasingly prioritizing privacy and security.
Furthermore, the Data Protection Board, which will act as an adjudicatory body, will bring much-needed clarity and accountability to the process, ensuring that disputes between businesses and users are resolved efficiently.
Conclusion
The Digital Personal Data Protection Act is more than just a regulatory framework; it’s a call for responsible data handling across industries. For consumers, it’s about security and control. For businesses, it’s about trust and transparency.
This shift marks a new era for India’s digital economy, one that prioritizes privacy, accountability, and trust. It’s a win-win for all stakeholders—consumers, businesses, and regulators alike. Those who embrace it early will be better positioned to lead in this evolving landscape.
(The author is Sandeep Kadam, CTO – Kissht, and the views expressed in this article are his own)
