The Reserve Bank of India is planning to initiate a pilot programme next year in 2025, which will offer data storage to financial institutions at reasonable prices, according to sources cited by Reuters.
In the first-of-its-kind initiative from a major global central bank, the cloud platform will be utilizing local IT firms, against Amazon Web Services, Microsoft Azure, Google Cloud and IBM Cloud.
A report by International Data Corporation estimated Asia’s third largest growing cloud services market, India, to be at $8.3 billion in 2023 and is expected to boost further to $24.2 billion by 2028. However, it is largely dominated by foreign firms.
“We want to start implementing on a smaller scale in the next few months,” a senior executive working on the project said.
The source further informed that over the course of the next few years, the pilot will be expanded in phases. The cloud service will be designed focusing on the requirements of smaller banking and financial services firms who find existing offerings unaffordable.
RBI Governor Shaktikanta Das announced a proposal to establish a public cloud for the financial services industry in December of last year.
Consultancy firm EY has been appointed as an advisor to the project. The initial framework of the cloud is being developed by Indian Financial Technology and Allied Services, the research wing of the central bank, and will be further evolved under partnership with one or more private sector technological firms, as per the sources.
The project will be initially funded by the central bank’s asset development fund, amounting to Rs 229.74 billion at a later stage, the central bank will invite financial firms to take equity stakes in the initiative.
Establishing a cloud service in partnership with local IT firms is a key step in the central bank’s ongoing efforts to promote the localization of payments and financial data.