DPDP Rules: How India’s data reset forces every industry to rewrite its playbook

New Delhi: India’s Digital Personal Data Protection (DPDP) Rules mark the country’s most consequential overhaul of its digital economy since Aadhaar. For the first time, the industry’s decade-long “wait-and-watch” posture has been replaced by a legally enforceable privacy regime with timelines, obligations, and penalties. And across verification, marketing intelligence, cybersecurity, cloud, and digital trust, companies are beginning to internalise what policymakers have signalled clearly: the era of limitless data, ambiguous consent, and unverified storage is over.

The DPDP framework forces the ecosystem to confront fundamentals, what data should be collected, how long it must stay, who controls it, and how each unit of personal information can be justified when auditors come knocking. 

The industry is responding with a mix of urgency, realism, and, in many quarters, an acceptance that the rules represent a structural shift rather than a passing compliance cycle.

The immediate shock to data-heavy sectors

Few industries feel the ground shifting as quickly as background-verification platforms and marketing-intelligence ecosystems. Shashank Karincheti, Co-Founder & Chief Product Officer (CPO) at Redacto, outlined the pressure with precision: “Digital background-verification and marketing-intelligence platforms will feel the DPDP impact immediately because their business models depend on large-scale data aggregation and analysis. The Rules now require explicit consent, clear purpose limitation, and full traceability of every data source. This means platforms can no longer rely on inherited or opaque datasets. They will need verifiable consent trails and well-defined retention and deletion mechanisms for each data point they process.”

The shift is not only restrictive, it is transformative. As Karincheti noted, “The positive outcome is that this change will bring higher quality and more trusted data into the system. Companies that adapt early will find that structured compliance improves both reliability and customer confidence. At Redacto, we are helping enterprises in these sectors operationalise compliance by giving them continuous visibility into how personal data is collected, processed, and shared. The future of marketing and verification will belong to platforms that treat privacy not as a restriction, but as proof of integrity.”

Children’s data gets the hardest guardrails

Among the most debated sections of the Rules is the treatment of children’s data, an area India has long neglected.

Vikas Bansal, Partner, IT Risk Advisory and Assurance, BDO India, explained, “Rule 10 establishes a clear obligation for Data Fiduciaries to obtain verifiable parental consent before processing the personal data of children. To comply with this requirement, a Data Fiduciary must also ensure that the individual providing consent is an identifiable adult. This verification may be carried out using identity or age information already held by the Data Fiduciary or through details voluntarily submitted by the parent or guardian.”

But the Rules do not blindly impose friction. As Bansal noted, the law introduces nuance: “Accepted methods include digital identity mechanisms such as Digital Locker tokens. However, the framework also recognises situations in which strict parental-consent requirements may hinder essential services. Accordingly, the rule proposes specific exemptions for certain categories of Data Fiduciaries. These include entities operating in the healthcare and education sectors, where children’s data is processed solely for health-protection purposes or for educational activities. Similar exemptions apply to services that process children’s data strictly for ensuring child safety.”

Critically, these are not loopholes. “These carve-outs are narrowly tailored, applying only when personal data is used exclusively for the stated purpose and not repurposed for commercial or unrelated activities. By combining robust consent obligations with carefully defined exemptions, Rule 10 seeks to safeguard children’s data without disrupting access to vital services.”

Retention limits are redrawing the data economy

If purpose limitation defines the spirit of DPDP, retention limits define its teeth. Gaurav Kaushik, founder of Nians, illustrated the recalibration underway:

“At Nians, we’re adapting to the DPDP’s three-year data-retention limit by recalibrating long-term behavioural datasets, identity graphs, and risk-scoring models. Using privacy-friendly aggregation and anonymisation, we can still identify meaningful trends and retain actionable insights without keeping personal data longer than necessary.”

The new reality is shorter cycles, fresher cohorts, and consent provenance as a living artefact, not a check-box.  “We ensure real-time, verifiable consent through advanced consent management integrated across all touchpoints. Our systems track, verify, and audit user permissions continuously, even as datasets are aggregated or enriched. By leveraging blockchain-inspired logs and automation, we maintain a clear and tamper-proof chain of consent,” Kaushik noted.

From verification workflows to marketing intelligence, Kaushik said risk is being re-engineered.
“Stricter accountability, mandatory audits, and user-rights workflows are reshaping our business. We are moving toward modular pricing, risk-sharing partnerships, and auditable tech investments. Over the next 12–18 months, we will prioritise scalable, auditable solutions that not only meet regulatory requirements but also create strategic advantages for our clients,” he said.

New data hygiene war simmering

Even the purest consent mechanisms fail if the underlying data itself is polluted.

Amit Relan, CEO and Co-founder of mFilterIt, framed it bluntly: “The DPDP rules are a positive step toward strengthening India’s digital ecosystem. In a landscape where a share of digital interactions can come from bots or synthetic identities, unvalidated signals often get stored as real user data, eventually influencing behavioural insights and long-term models.”

His warning is unambiguous: “Traffic validation naturally complements data protection by ensuring that what we safeguard is accurate and trustworthy. When the data foundation is clean, the entire digital ecosystem becomes stronger, more reliable, and better aligned with the intent of the DPDP framework.”

Startups: cost burden or opportunity? 

No sector feels DPDP more deeply than India’s startup community. Vijender Yadav, CEO & Co-founder of Accops, captured the paradox. “The DPDP Act fundamentally reshapes the foundation for Indian startups. While the sheer cost of compliance from implementing a robust Consent Management System to automating data mapping and erasure workflows presents a significant short-term financial and operational hurdle, this challenge is also their greatest opportunity.”

The opportunity, Yadav argued, is architectural: The DPDP Act essentially mandates 'Privacy-by-Design' from day one. Those that integrate stringent security measures, like Zero Trust Network Access (ZTNA) and Identity and Access Management (IAM) solutions, will turn a compliance cost into a competitive differentiator.

A 15-year journey reaches the implementation stage

Dhruv Garg, Founding Partner, IGAP, said, “The DPDP Rules represent the moment India’s privacy project finally moves from a 15-year-long debate to actual implementation… They introduce the idea of an authorised entity that can issue identity, age details, or virtual tokens for parental consent… and add a new mandatory one-year retention requirement for personal data, associated traffic data, and processing logs.”

With timelines now firm, execution becomes the real battlefield. “With immediate activation of the Data Protection Board, a one-year window for Consent Managers and a full compliance deadline in 18 months, the burden on organisations, particularly smaller firms, will be significant,” he added.

Enterprises begin the long march of system cleanup

Sumed Marwaha, Managing Director at AHEAD India, situated DPDP globally: “With the DPDP Rules, India joins the league of global data protection frameworks such as GDPR and CCPA - only sharper and more scalable for the country’s digital ambitions.”

For Marwaha, execution, not intent, will define success. “The DPDP Rules are a strong start, but the proof lies in execution. We remain committed to guiding our clients through each phase of adoption,” he added. 

Verification platforms face a hard reset

Few domains require as complete a rebuild as verification, where legacy practice relied on long-term repositories. “The DPDP framework forces the ecosystem to re-evaluate what ‘historical’ really means and which parts of long-term data are essential for a verification outcome,” Manav Jain, Chief Business Officer, OnGrid, stated it plainly.

He detailed a shift away from identity graphs and toward event-specific flows, short-lived datasets, and purpose-bound retention. Equally seismic is the shift in consent provenance: “For verification platforms, consent provenance becomes a first-class requirement under DPDP, API-level consent propagation, ensuring our downstream partners only receive data when valid consent exists for that specific transaction.”

Jain also highlighted the biggest operational rewrite. “The industry has long stored more than what is essential. Under DPDP, the default becomes, “If it is not required for the ongoing verification, it should not be stored.”

DPDP is not a law. It is a reset button

Across sectors, one truth is unmistakable: DPDP is not an incremental policy; it is a structural rewiring of India’s digital economy. Companies that view it as a compliance checklist will struggle. Companies that view it as an architectural, cultural, and operational redesign will thrive. The Rules strike a balance India has long needed: an economy that can scale without leaving citizens behind, and a digital ecosystem that grows without consuming its own credibility. The next 18 months will determine whether India’s digital future is built on trust or on technical debt.