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RBI to Shake Up Cloud Market in 2025, Taking on Tech Giants with First-Ever Central Bank Service
The Reserve Bank of India (RBI) is preparing to make a groundbreaking move into the cloud services sector, aiming to compete with global technology leaders like Amazon, Microsoft, and Google. In a first-of-its-kind initiative by a central bank, the RBI plans to launch a pilot program in 2025, offering cloud storage solutions tailored to financial institutions.
Affordable Cloud Solutions for Financial Firms
The initiative, targeting smaller banking and financial services firms, seeks to provide cost-effective and secure cloud storage options. Sources reveal that the project will initially be funded through the RBI’s asset development fund, which currently stands at Rs 229.74 billion (approximately $2.72 billion). Over time, the RBI intends to invite financial institutions to take equity stakes in the venture.
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Competing in a Growing Market
India’s cloud services market is projected to expand significantly, from $8.3 billion in 2023 to $24.2 billion by 2028, according to the International Data Corporation. This ambitious move positions the RBI as a competitor to established players like Amazon Web Services (AWS), Microsoft Azure, and Google Cloud.
Strategic Collaboration and Development
Announced by RBI Governor Shaktikanta Das in December 2023, the project is being developed in collaboration with private technology firms.
EY has been appointed as an advisor, and the RBI has invited bids from India-incorporated companies with expertise in cloud solutions. Participating firms are required to establish data centers in Mumbai and Hyderabad, either independently or as part of consortiums.
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The project aligns with the RBI’s broader objectives of localizing payments and financial data storage to strengthen data sovereignty.
The central bank’s research arm, Indian Financial Technology and Allied Services (IFTAS), is spearheading the initiative’s initial development phase, with plans for phased implementation and expansion in the coming years.
A Game-Changer in Financial Data Storage
This venture underscores the RBI’s commitment to leveraging technology for innovation in the financial sector. By entering the cloud services market, the central bank aims to enhance data security, promote affordability, and challenge the dominance of global tech giants in India’s rapidly evolving cloud ecosystem.