How To Navigate RBI’s New PSO Guidelines: What You Need To Know

Apurv Garg

September 2, 2024

How To Navigate RBI’s New PSO Guidelines: What You Need To Know

Reserve Bank of India (RBI) has recently introduced information security guidelines for Payment System Operators (PSO), which covers entities like card providers, mobile wallets, payment aggregators etc.

The RBI guidelines provide a framework for PSO’s to secure customer data and financial frauds against different kind of threats. This requires PSO’s to map data flows, regularly assess risks, document key assets, secure PII, implement data segregation and deploy anti-malware solutions.

Through these guidelines, Reserve Bank of India wants to ensure that the growth in digital finance sector can continue to happen, without comprising national security. Clear guidelines enables PSO’s to maintain strong information security practices without hampering innovation. We all know the importance of adhering to these guidelines — I so wish that I could still use my PayTM FASTag!

Aurva aids these PSO’s by providing real-time visibility into data flows, detecting unusual activities, and ensuring compliance. Our platform offers robust tracking and classification of cloud assets, encryption of PII, detailed audit logs, and data segregation in multi-tenant environments, helping PSOs meet RBI’s stringent requirements efficiently.

What are PSO’s?

Payment System Operators (PSO’s), authorised by the Reserve Bank of India (RBI), manage and facilitate secure electronic transactions such as online, card, mobile, and electronic fund transfers.

They include entities like card providers, mobile wallets, payment aggregators, UPI providers, ATM Networks and payment gateways like Razorpay, Amazon Pay, Phonepe, PayU etc, acting as intermediaries between buyers and sellers.

Why are these guidelines important?

Digital payment companies are driving growth and innovation, revolutionising how we handle transactions. However, RBI’s PSO guidelines ensure this growth is balanced with strong security practices to protect user data. These guidelines not only help companies scale effectively but also ensure they maintain compliance, cyber resilience, and consumer trust, promoting long-term stability in the financial ecosystem.

Non-compliance with RBI regulations can result in significant legal and business consequences, including criminal penalties, fines, operational disruptions, and a potential loss of customers. Recent RBI actions, like restrictions on Paytm Payments Bank for KYC violations, underscore the importance of adhering to these guidelines.

Start Compliance Efforts Early

Leading companies in the payment ecosystem are already aligning their systems with the RBI’s new PSO guidelines, setting a strong example for regulatory compliance and positioning themselves as industry leaders in security and resilience. By starting compliance efforts now, they gain a significant edge, ensuring they are well-prepared before the April 2025 deadline.

This proactive strategy not only reduces the risk of rushed, last-minute implementations ensuring that their business is unhampered but also highlights their commitments to best practices and customer security. As a result these companies further cement their reputation as trusted industry leaders.

Key Areas of RBI Cybersecurity Guidelines:

The Reserve bank of India (RBI) has established comprehensive PSO guidelines, which can broadly be categorised into four key areas:

Governance,
Information Security,
Asset and Data Management, and
Monitoring and Incident Management.

Let’s dive deeper into each of these areas:

Governance Policies:PSO’s must conduct cyber risk assessments and implement multi-factor authentication for access control. They must maintain robust cloud policies for data segregation and localisation. Compliance with PCI-DSS if dealing with cardholder data and geographical data localisation laws is mandatory. Additionally, PSO’s must report any unusual incidents within six hours, establish fraud detection systems and maintain detailed audit logs with clear reporting structures in place for governance.
Information Security Policies:To safeguard their network, PSO’s must enforce network segmentation and control access through whitelisting. Anti-malware solutions are essential to protect all devices connected to the network and they must meet established security standards. Secure messaging systems must be used to prevent data breaches while anti-phishing and rogue app detection services are a mandated to mitigate external threats.
Asset and Data Management Policies:PSO’s must document key assets — including hardware, software, and personnel — with detailed records of network addresses, ownership, and end-of-life status. Mapping data flows is crucial, and all Personally Identifiable Information (PII) must be encrypted both in transit and at rest. Clear guidelines for data storage and security must be followed, especially with third-party systems. Additionally, PSO’s must also ensure that vendors adhere to security policies, particularly regarding data localisation.
Monitoring and Incident Management Policies:Establishing a Security Operations Centre (SOC) is essential for PSO’s to proactively monitor security incidents and system logs. They must also report any cyber-attacks or outages within six hours followed by a post-incident forensic analysis. Real-time fraud detection systems must also be implemented to identify suspicious activities and respond to them effectively.

The Aurva Solution

As Payment System Operators (PSO’s) face mounting challenges to enhance security and maintain compliance with RBI guidelines, Aurva has stepped up to provide comprehensive solution and simplify this process. Our tools are tailored to help PSOs effectively navigate these challenges.

Leave your security and compliance headaches to Aurva, and concentrate on moving your core business forward. With Aurva by your side, you can trust that your security and compliance needs are in capable hands.

Here’s how Aurva supports your organisation:

Aurva’s platform offers real-time visibility into data movement both within and outside the organization. This enables PSOs to detect unusual activities, mitigate security risks, and meet compliance standards.
Aurva provides comprehensive tracking and classification of cloud-based assets, offering clear insights into where the data is stored and how sensitive it is. With continuous monitoring, Aurva can also generate alerts based on the risk level, enabling swift responses to potential security threats.
Aurva helps with protection of Personally Identifiable Information (PII). Aurva can help organisations monitor data flows, ensure secure handling, encrypt data at rest, and track PII both in transit and at rest. Aurva’s real-time monitoring and alerts enable quick detection and reporting of cyberattacks and other security incidents.
Aurva helps with multi-tenant environments by ensuring clear identification and segregation of each tenant’s data by monitoring its flow to prevent co-mingling and maintain data privacy.
Furthermore, Aurva provides detailed audit log management, tracking all events related to database and associated user actions, facilitating PSOs’ compliance with regulatory requirements for audit data retention, ensuring that all activities are properly documented.
To further protect sensitive customer information such as bank accounts and card details, Aurva automatically masks these details in notifications, ensuring compliance RBI PSO Guidelines.

Ready to ensure compliance and elevate your security standards?

Navigating RBI’s new PSO guidelines can be complex, but with the right tools and expertise, businesses can not only meet regulatory requirements but also strengthen its data protection strategies. Our Data Security and Posture Management (DSPM) and Database Activity Monitoring (DAM) solutions helps you to seamlessly align with compliance standards while enhancing overall security.

This has not only simplified compliance & security journey of our customers but has also positioned them as leader in security & resilience. To be compliant & secure, schedule a call with us to discuss your current security and compliance measures and understand how we can help you better.

We can also assist your company in managing the intricacies of the Digital Personal Data Protection Act (DPDPA) and other regulatory obligations. With the help of our technologies, your company will be able to automate compliance procedures, remain ahead of regulatory changes, and uphold the strictest governance and data protection guidelines.