Digital Personal Data Protection Act 2023 Explained

The Digital Personal Data Protection (DPDP) Act is India’s new law that sets clear rules on how personal data should be collected, used, stored, and shared in the digital world. It gives people control over their own data and makes sure companies are transparent and accountable when handling information like names, contact details, or online behaviour.

Under the DPDP Act, individuals gain rights such as accessing, correcting, or even deleting their digital personal data. The law also requires organizations to get clear consent and protect data with strong security measures, helping build trust in India’s digital economy.

What is the Digital Personal Data Protection Act 2023?

The Digital Personal Data Protection Act (DPDP) 2023 governs how businesses and government bodies collect, process, store, and share personal data. It ensures individuals’ privacy while enabling safe use of digital information for services, advertising, and personalization. DPDP protects rights, prevents misuse, and promotes responsible handling of digital personal data.

Who Does the DPDP Act Apply To?

The DPDP (Digital Personal Data Protection) Act applies to anyone handling digital personal data about individuals, whether in India or offering services to users in India. It covers data collected digitally or digitized later, making businesses that process such information responsible under the law.

Applicable to:

• Businesses processing digital personal data in India
• Foreign companies offering goods/services to Indian users
• Entities storing digitized offline personal data
• E‑commerce platforms with Indian customers
• Social media services targeting Indian users
• Tech firms processing user information
• Financial institutions collecting personal data
• Healthcare companies handling patient data
• Data fiduciaries under the Act’s definition
• Data processors acting on behalf of fiduciaries
• Any organisation with identifiable user data

Rights of Individuals Under the DPDP Act

The Digital Personal Data Protection Act defines clear rights for individuals, ensuring transparency, control, and accountability in how organisations collect, use, store, and share personal data across digital ecosystems securely.

• Right to Information: Individuals can know what personal data is collected, why it is processed, and shared recipients are.
• Right to Access: They may request confirmation and access to personal data processed by organisations under the DPDP Act.
• Right to Correction or Erasure: Individuals can correct inaccurate personal data or request deletion when data is outdated or unnecessary legally.
• Right to Object: Data principals may object to certain data processing activities that violate consent or lawful purposes.
• Right to Data Portability: Individuals can request the transfer of their personal data to another service provider securely when applicable.
• Right to Redress: They can file complaints with the Data Protection Board for DPDP Act violations if required.
  

Responsibilities of Businesses Under the DPDP Act

The DPDP (Digital Personal Data Protection) Act makes businesses accountable for how they collect, process, store, and secure personal data. This ensures trust, transparency, and compliance with India’s new privacy framework.

• Obtain valid consent: Secure clear, informed consent before collecting or processing any personal data.
• Limit data use: Use personal data only for the purposes stated at the time of collection.
• Ensure data security: Implement strong safeguards to protect data from unauthorized access or breaches.
• Maintain data accuracy: Keep personal data accurate and up-to-date throughout its lifecycle.
• Manage retention: Retain data only as long as needed and delete it when no longer required.
• Notify breaches: Report breaches promptly to authorities and affected individuals.
• Be transparent: Clearly communicate how data is used and allow users to exercise their rights.

These duties help businesses follow the Digital Personal Data Protection Act and protect personal data while staying legally compliant.

Features of the DPDP Act

The DPDP (Digital Personal Data Protection Act) introduces a modern, consent‑centric framework to protect personal data in India, balancing user rights with business needs under clear legal obligations.

• Applicability across digital data – Applies when personal data is collected, stored, or processed digitally in or for India.
• Informed consent requirement – Organisations must obtain clear, specific, and revocable consent before processing.
• Notice obligation – Data principals must be informed about the data collected and its purpose before consent.
• Rights of individuals – Users have rights to access, correct, and delete their digital personal data.
• Data breach notifications – Companies must promptly notify affected individuals and authorities about breaches.
• Cross‑border transfer rules – Personal data may be transferred overseas under specified conditions.
• Significant Data Fiduciary duties – Certain entities face extra compliance like DPIAs and DPOs.
• Penalties for violations – Non‑compliance can attract fines up to very large amounts.

This framework makes the Digital Personal Data Protection Act central to privacy, accountability, and secure data practices for modern businesses.

Penalties for Non-Compliance

Not following the DPDP Act can lead to heavy fines. Businesses must protect personal data to avoid penalties and reputational harm.

Nature of Violation/Breach	Penalty
Failure to implement security safeguards	Up to INR 250 crores (~ $30.213 million)
Failure to notify a breach to the board	Up to INR 200 crores (~ $24.17 million)
Non-compliance with the special provisions regarding children	Up to INR 200 crores (~ $24.17 million)
Non-compliance with the obligations of SDF	Up to INR 150 crores (~ $18.127 million)
Non-compliance of obligations by the data principals	Up to INR 10,000 (~ $120)
Violation of any voluntary undertaking	Up to the extent applicable to that breach
Violation of all other provisions not mentioned above	Up to INR 50 crores (~ $6 million)

Knowing DPDP Act penalties helps businesses protect data and avoid legal or financial risks.

Conclusion

The Digital Personal Data Protection (DPDP) Act 2023 sets rules for collecting, storing, and sharing personal data in India. It gives individuals control over their data and ensures organizations act transparently and securely.

It applies to any business or entity handling personal data, including foreign firms offering services to Indian users. Individuals gain rights like access, correction, deletion, objection, and data portability under the law.

Businesses must obtain consent, secure data, maintain accuracy, and report breaches. Non-compliance can result in heavy fines, making adherence crucial for trust, accountability, and legal compliance in India’s digital economy.

Frequently Asked Questions