Russian banks with basic licenses may get more time to prepare for biometric data collection

Maria Nikolova

Banks with basic licenses are set to be allowed to install all necessary equipment by the end of 2020 instead of the end of 2019.

Russian banks with basic licenses are poised for a brief reprieve from getting their offices ready for collecting the biometric data of their clients and sending it to the Single Biometric System, the Central Bank of Russia said today. The relevant legislative proposal is now being discussed at the State Duma – the lower chamber of the Russian Parliament.

Under the current rules, all Russian banks will have to be able to collect biometric data at their branches. The technological preparation for this has to be completed by the end of 2019.

However, collecting biometric data and remote identification of clients via the Single Biometric System requires substantial changes to the banks’ infrastructure, including IT enhancements related to cyber security. These complex tech projects consume a heavy volume of material and human resources, Olga Skorobogatova, First Deputy Governor of the Central Bank of Russia said.

Ms Skorobogatova added that large banks have already started implementing the necessary tech solutions but banks with basic licenses (they deal with small businesses and household finances) given their smaller size need more time for preparation.

That is why, the Central Bank of Russia considers that banks with basic licenses should be given time until December 31, 2020 to comply.

At present, biometric data collection is conducted at over 400 branches of 27 credit organizations in 85 regions of the Russian Federation. The idea is to enable clients of these banks to make use of the so-called remote identification when performing certain operations. Simply put, the idea is to spare clients from having to visit a physical bank branch.

Let’s recall that, according to recent estimates published by Russian newspaper “Kommersant”, the collection of biometric data and its transfer to the Single Biometric System is quite pricey. A bank has to install (inter alia) HSM module, certain OS, as well as anti-virus programs, to name a few of the necessary elements.

The minimum expenses for a bank with one branch are put at RUB 4 million. This, of course, is not the end to it, as the expenses for each additional branch will be at least RUB 130,000. Once connected to the System, each bank has to set aside RUB 800,000 for maintenance purposes per year.

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