RBI to launch affordable cloud storage for financial firms to counter dominance of AWS, Microsoft Azure, Google Cloud: Report

The Reserve Bank of India (RBI) is preparing to launch a pilot programme in 2025 aimed at providing affordable local cloud storage solutions for financial firms, according to a report by Reuters. This initiative is intended to challenge the dominance of international cloud service providers such as Amazon Web Services, Microsoft Azure, Google Cloud, and IBM Cloud. The move, confirmed by sources familiar with the matter, remains confidential as discussions continue.

This marks a significant step globally for a central bank, as the RBI plans to collaborate with local IT firms to develop the platform. The goal is to offer smaller financial firms cost-effective alternatives to existing cloud services.

India's cloud services market, currently valued at $8.3 billion, is expected to grow to $24.2 billion by 2028, according to International Data Corporation. Presently dominated by international companies, the RBI's project aligns with efforts to localise payments and financial data, ensuring compliance with India's data sovereignty requirements.

"We aim to start implementing on a smaller scale in the next few months," stated a senior executive involved in the project. The pilot programme is set to expand gradually to address the needs of smaller banking and financial services firms.

The RBI's public cloud service plans were first announced in December 2022. The initial development is being led by Indian Financial Technology and Allied Services (IFTAS) in collaboration with private tech companies, with consultancy firm EY appointed as an advisor.

Funding for the initial phases will come from the central bank's asset development fund of ₹229.74 billion ($2.72 billion). Financial firms will eventually be invited to invest and hold equity in the cloud service.

According to an October procurement document on the IFTAS website, only Indian-registered companies with experience in cloud technology can bid for the project. These participants must establish data centres in Mumbai and Hyderabad.

"We've seen significant interest from IT and Indian cloud service companies eager to partner on this project," the report said, citing a source. This initiative represents a crucial moment for India's financial and tech sectors, aiming to balance innovation with localised control over essential infrastructure.