Data Privacy Challenges Facing Indian Businesses in 2025

DPDPA Section 6 establishes consent as the primary lawful basis for personal data processing, requiring that consent be free, specific, informed, unconditional, and unambiguous. The practical challenge lies not in understanding these requirements but in implementing consent mechanisms that satisfy legal standards while remaining functional for business operations.

Many organisations initially approached DPDPA consent by adding lengthy disclosures to existing consent flows. This approach creates what behavioural researchers term "consent fatigue," where users click through without genuine engagement, undermining the very purpose of informed consent. The regulatory risk is significant: consent obtained through incomprehensible notices may be challenged as failing the "informed" requirement.

Effective consent architecture requires rethinking how and when consent requests appear. Just-in-time consent, where permissions are requested at the moment data is actually needed rather than upfront, produces both higher engagement rates and more defensible legal positions. Granular consent options, allowing users to approve some processing purposes while declining others, create initial implementation complexity but result in consent that genuinely reflects user preferences.

Perhaps no challenge proves more persistent than integrating DPDPA requirements with existing technology infrastructure. Large organisations typically operate dozens or hundreds of systems that process personal data, many designed and deployed before privacy-by-design became a recognised principle.

The temptation to defer compliance until systems can be replaced rarely proves viable. System replacement cycles measured in years cannot accommodate compliance timelines measured in months. Moreover, the notion that new systems will inherently be privacy-compliant overlooks the reality that compliance requires deliberate design choices, not automatic features.

Practical approaches involve implementing privacy controls at integration points rather than within legacy systems themselves. API gateways can enforce purpose limitation and access controls regardless of what underlying systems do with data. Data lakes and warehouses can implement retention policies centrally even when source systems lack such capabilities. Privacy-enhancing technologies like tokenisation can protect data in transit between systems that cannot themselves provide adequate protection.

DPDPA Section 16 restricts transfers of personal data to countries outside India, with the Central Government empowered to notify permitted jurisdictions. As of early 2025, the notification of permitted countries remains pending, creating substantial uncertainty for organisations with international operations.

The practical challenge extends beyond regulatory uncertainty. Many organisations cannot definitively identify all instances where personal data crosses borders. Cloud services, SaaS applications, and multinational corporate structures create data flows that business users rarely consider in privacy terms. A sales team using a US-based CRM, an HR department with a Singapore-hosted benefits platform, or a marketing team leveraging EU-based analytics tools all generate cross-border transfers requiring analysis.

Prudent compliance strategies involve comprehensive data mapping to identify all cross-border flows, followed by classification based on transfer necessity and available alternatives. For essential transfers, organisations should prepare documentation supporting legitimate use exemptions under Section 7 or demonstrating compliance with any conditions attached to country notifications when issued.

The Data Protection Board of India, established under DPDPA Section 18, represents an entirely new regulatory body without precedent or established enforcement patterns. Organisations cannot reference past enforcement actions to calibrate risk assessments or understand regulatory priorities.

This uncertainty complicates compliance investment decisions. Without clarity on enforcement focus areas, organisations struggle to prioritise among competing compliance initiatives. Should resources concentrate on consent mechanisms, data security, breach notification capabilities, or rights request handling? Each represents a significant investment, and enforcement priorities will ultimately determine which lapses create greatest risk.

Practical responses involve building compliance programmes that address statutory requirements comprehensively while maintaining flexibility to adjust emphasis as enforcement patterns emerge. Documentation proving good-faith compliance efforts may prove valuable regardless of specific enforcement focus, as regulators typically distinguish between organisations making genuine compliance attempts and those ignoring obligations entirely.

DPDPA Section 9 imposes heightened requirements for processing children's personal data, including mandatory verifiable parental consent. The provision creates particular challenges for EdTech platforms, gaming companies, and any digital service that may attract users under 18.

Age verification itself presents a privacy paradox: determining whether someone is a child requires collecting information about them, potentially including data that would trigger children's data protections. The balance between effective age gating and minimal data collection requires careful design.

Verifiable parental consent mechanisms must be robust enough to satisfy regulatory requirements while remaining practical for parents to complete. Overly burdensome consent processes drive users to competitors or encourage age misrepresentation. Effective approaches typically involve tiered verification, with lighter-touch methods for lower-risk processing and more rigorous verification for sensitive data or high-risk activities.