DPDP Act: A New Opportunity for Consent Management Startups

Explore the emerging opportunity in India's startup ecosystem with the new DPDP Act. Learn how consent managers are set to play a pivotal role in data privacy, compliance, and the growth of startups in the consent management space.

author-image
Shreshtha Verma
Updated On
New Update
DPDP Act New Opportunity for Consent Management Startups

The introduction of the Digital Personal Data Protection (DPDP) Act’s draft rules has opened a new avenue in the Indian startup ecosystem: consent management. As the Act mandates businesses to establish dedicated consent managers for user data, experts predict that this new regulatory requirement could lead to a thriving market worth billions of rupees in the coming years.

Here TICE explains how DPDP can be a game changer for Consent Management Startups

DPDP Act: Role of Consent Managers

The core objective of the DPDP Act is to provide individuals with better control over their personal data. The Act mandates that businesses, known as data fiduciaries, notify users about the data they collect and explicitly seek consent for its continued use. The key to this transformation lies in consent managers, entities that will act as central platforms for users to manage, review, and withdraw consent.

Read More: Why Are Indian Startup Founders Rebooting? A Deep Dive Into the Exodus

These consent managers will play a critical role in helping businesses comply with the DPDP Act, starting with notifying users about their existing data and obtaining explicit consent for its continued usage. The shift towards more transparent and user-controlled data practices is expected to lead to increased demand for solutions that streamline this process.

A Growing Market for Consent Management Solutions

The opportunities for startups in the consent management sector are immense. Several business sectors, including banking, financial services, insurance (BFSI), gaming, social media, telecom, and retail, are expected to adopt consent management solutions early on. Industry experts suggest that the market could quickly scale up as the need for transparent, interoperable platforms becomes urgent.

Startups are looking to capitalize on this growing demand by offering tools to help businesses efficiently manage and simplify the consent process. With the regulatory shift toward greater data transparency, consent managers will be integral in enabling businesses to handle users' data securely and compliantly.

The Business Models and Revenue Potential

Pricing models for consent management solutions are likely to vary. Industry experts predict that startups will offer a range of options, from per-user charges to bundled offerings, depending on the size of the company or the volume of consents being handled. This flexibility in pricing could allow businesses of all sizes to adopt these solutions, ensuring widespread compliance with the new regulations.

Startups in the sector are positioning themselves to generate substantial revenue from this growing market. However, concerns have been raised about the possibility of government-imposed pricing caps on these services, which could affect profitability. The introduction of pricing regulations similar to the account aggregator framework in the financial sector may impact the scalability of consent managers and their ability to charge competitive rates.

Read More: India Pavilion at Davos 2025: A Global Tech and Semiconductor Leader

Interoperability: The Key to Seamless Consent Management

One of the primary challenges and opportunities for consent managers is ensuring interoperability across various industries. For users to effectively manage and track their consents, consent managers must provide a unified platform that adheres to common standards across sectors. This interoperability will enable users to have a seamless experience as they navigate different services and manage their data consent in one place.

Experts emphasize that the success of consent management solutions will depend heavily on the ability to create platforms that can evolve alongside the regulatory landscape, ensuring businesses can remain compliant as new standards and requirements are introduced.

Challenges and Opportunities in the Consent Manager Ecosystem

While the consent manager market is brimming with potential, the sector faces several challenges. Interoperability between different consent managers, scalability of solutions, and pricing caps are all areas of concern that could affect the long-term profitability of businesses operating in this space. Additionally, the sector is still awaiting final government guidelines to help finalize strategies and products for the upcoming launch of the consent management framework.

Despite these hurdles, the market's long-term potential remains strong, with a variety of industries, including BFSI, gaming, social media, telecom, and retail, expected to be early adopters of consent management tools. Startups are already conducting proof-of-concept tests and refining their offerings to ensure they meet compliance standards set by the DPDP Act.

Read More: Funding News: Indian Startups Raise $275.2 Mn This Week Despite a Dip

The Road Ahead for Startups in the Consent Management Space

As startups continue to innovate and develop solutions to address the needs of consent management, the next few years will be crucial for shaping this emerging industry. Companies that can provide user-friendly, scalable platforms will be best positioned to lead the charge in the growing data privacy and consent management space.

Experts predict that the demand for these services will skyrocket as businesses of all sizes strive to comply with the DPDP Act. With the right solutions, startups can not only secure a significant share of this market but also help create a more transparent, user-controlled data environment in India.

Join Our Thriving Entrepreneurial Community

TICE Social Media

Twitter: @TiceNews | LinkedIn: TICE News | Instagram: @tice.news | Google: Leave a Review

Subscribe