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Why the Joint Parliamentary Committee wants India to build an alternative to SWIFT payment network

The network connects more than 11,000 banks in over 200 countries to process over 35 million transactions per day.

An alternative to the SWIFT payment system should be developed in India to ensure the privacy of Indian citizens and to give a boost to the domestic economy, the Joint Parliamentary Committee on the Personal Data Protection Bill recommended in its report tabled in Parliament on December 16. The Committee made this recommendation after it received feedback from stakeholders that there are possible chances of breach of privacy in the SWIFT system. In making its recommendation, the Committee noted: "The Committee observe that data protection in the financial sector is a matter of genuine concern worldwide, particularly when through the SWIFT network, privacy has been compromised widely. Indian citizens are engaged in huge cross border payments using the same network. [...] The Committee, therefore strongly recommend that an alternative indigenous financial system should be developed on the lines of similar systems elsewhere such as Ripple (USA), INSTEX (EU), etc. which would not only ensure privacy but also give a boost to the digital economy." The Committee, however, did not elaborate on how such an alternative will replace the functions of SWIFT, which is a global standard used by over 200 countries, or how it will benefit Indian economy. What are the problems with SWIFT? 1. US control over the network: One of the reasons the Committee believed that SWIFT might compromise the privacy of Indian citizens is because of the control the US might have over the network. Terrorist Finance Tracking Program:  A memorandum received by the Committee stated: "A series of articles published on 23 June 2006 in The New York Times,…

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