India’s central bank plans to launch a pilot program in 2025 to provide affordable cloud data storage for financial firms. According to confidential sources, the initiative aims to make cloud services more accessible while keeping costs low. This program marks a significant step towards innovation in the country’s financial sector.
The Reserve Bank of India (RBI) will partner with local IT firms to create the cloud platform. This move directly competes with major players like Amazon Web Services, Microsoft Azure, Google Cloud, and IBM Cloud. Notably, this is the first time a global central bank has attempted such a large-scale cloud initiative.
Asia’s third-largest economy has a rapidly growing cloud market. Valued at $8.3 billion in 2023, it is projected to reach $24.2 billion by 2028, according to the International Data Corporation. Despite this growth, foreign companies dominate the sector.
“We want to start implementing on a smaller scale in the next few months,” said one of the two sources, a senior executive working on the project.
The RBI aims to address this imbalance and cater to smaller financial firms that find existing solutions expensive.
RBI Governor Shaktikanta Das first revealed plans for the public cloud in December 2023. Although the RBI has not shared official details, the initiative will initially cater to smaller banking and financial firms. Expansion is planned over the next few years to ensure the service meets local needs.
The Indian Financial Technology and Allied Services (IFTAS), RBI’s research arm, leads the initial development. Later, private technology firms will join as partners to enhance the platform. To guide the project, the RBI has appointed Consultancy firm EY as its advisor.
Funding for the project will come from RBI’s asset development fund, which holds ₹229.74 billion ($2.72 billion). Eventually, financial firms may be invited to invest and have equity in the initiative. The RBI’s push for data localization further underscores the importance of this project in reshaping India’s financial infrastructure.
The RBI requires all bidders to be Indian-incorporated firms with cloud development experience. These firms must establish data centers in Mumbai and Hyderabad, either independently or as part of a consortium.
This initiative signifies a milestone in India’s financial technology journey, combining innovation and localization to transform cloud services.
“We have a humongous amount of interest (from private players who want to partner). A significant number of IT companies, as well as Indian cloud services companies, have expressed their interest,” the source added.
