What is an Account Aggregator?
An Account Aggregator is a type of NBFC licensed by the Reserve Bank of India (RBI) that allows individuals to consolidate and share their financial information—such as bank account details, income records, or investment history—with a regulated financial institution. Importantly, this happens only with your explicit consent.
Account Aggregators do not store your data. Instead, they act as secure intermediaries that transfer data from Financial Information Providers (FIPs) like banks or mutual funds to Financial Information Users (FIUs) such as life insurance companies, lenders, or financial advisors.
The objective is simple: make data sharing secure, standardised, and consent-driven—so individuals can access financial services more easily.
The Life Insurance Process: Then vs Now
Let’s understand how Account Aggregators enhance the life insurance application process:
Before AA, customers were able to share income and financial data either offline (paper documents) or online (uploads via insurer portals or email). However, this at times involved multiple submissions, manual verification, and longer turnaround times.
With AA, customers can now give consent to share verified financial data directly from their bank or other financial institutions through a licensed Account Aggregator. This reduces the need for repeated document uploads, speeds up verification, and improves accuracy. Importantly, data sharing is transparent, secure, and revocable, eventually giving customers more control.
Key Benefits of Account Aggregators in Life Insurance
Faster Onboarding
With direct access to your verified financial data (after your consent), insurers can assess your application quickly. This reduces wait times and accelerates policy issuance.
Reduced Paperwork
A single digital consent request can provide access to the necessary data from your bank or financial service provider.
Improved Customer Experience
A simple digital consent enables data sharing, making the process smoother and more user-friendly for you and don’t need to submit multiple documents or visit branches.
Secure and Transparent
Every data-sharing request is governed by RBI guidelines. You get to see exactly what data will be shared, with whom, for how long, and for what purpose. You can approve or deny requests and revoke consent at any time.
Real-Life Example: Applying for a Term Life Insurance Policy
Let’s say you are a 35-year-old professional applying for a term insurance plan with a ₹1 crore cover.
With Account Aggregator:
- You register with an RBI-approved AA (like CAMS Finserv or Finvu).
- While applying for the policy, the insurer sends a digital data access request.
- You review and approve the request via the AA app or portal.
- The insurer receives secure, verified data within minutes and processes your application.
How It Helps Different Customer Segments
For Salaried Individuals:
You can easily share verified income and employment details via your bank account, enabling seamless policy approval.
For Self-Employed Professionals:
With AA, you can share verified income data from multiple financial sources in one go. This helps insurers see income stability more clearly and assess eligibility with greater confidence.
For First-Time Buyers:
The simplicity of the AA process makes it easier to explore life insurance reducing paperwork or bank visits.
Is It Safe to Share Data Through an Account Aggregator?
Yes. Here’s why:
- AAs are licensed and monitored by the RBI.
- Data is encrypted end-to-end and is never stored by the Account Aggregator.
- You provide explicit consent before sharing any data.
- You can track, modify, or revoke any data-sharing permission at your convenience.
These safeguards ensure that your financial information remains private and secure throughout the process.
How to Get Started
Getting started with an Account Aggregator is easy:
- Choose a licensed AA.
- Create an account using your mobile number linked to your financial accounts.
- Link your bank accounts or other financial data sources to your AA profile.
- Give consent to authorised Financial Information Users (FIUs) like insurers or other financial service providers, to access your data when requested.
- Revoke or review consent anytime through the AA portal.
Conclusion
The introduction of Account Aggregators is a game-changer for life insurance in India. By making data sharing simple, secure, the AA system is helping insurers offer seamless approvals, and a easy buying experience—all without compromising on privacy.
As India continues its digital transformation, the Account Aggregator framework is set to play a vital role in helping people protect their loved ones through easy access to life insurance.
Frequently Asked Questions
Is it mandatory to use an Account Aggregator for life insurance?
No, it’s optional. However, using one can simplify your application processing and reduce document submission.
Who regulates Account Aggregators?
Account Aggregators are regulated by the Reserve Bank of India (RBI).
Can I revoke my data-sharing consent later?
Yes, you can revoke or modify your consent anytime via the AA platform.
Will my data be stored by the Account Aggregator?
No. AAs do not store your data. They only facilitate secure, encrypted transfer from the source to the requesting institution.
Is there a charge for using an AA?
Most AAs offer their services to individuals free of charge. Check with the AA provider for specific details.
