By Shivam Singla – Founder & CEO, Leegality
India’s telemarketing industry thrives on the vast potential of over a billion mobile users, with large companies employing thousands of telecallers to reach out to their customer base. While telemarketing offers a direct and cost-effective way to connect with consumers, its practice often crosses the boundary from persuasive marketing into the realm of privacy intrusion. This approach, despite its advantages, is marred by a significant downside: the widespread and often unchecked misuse of consumer consent.
The issue at hand is not trivial; receiving unsolicited calls is more than an annoyance—it’s a breach of privacy that can lead to frustration and, alarmingly, scams. A 2021 report by Truecaller revealed an unsettling trend: users in India face an average of 17 spam calls per month, a situation exacerbated by the absence of explicit consent from the users.
Stark realities
The bombardment of promotional calls without explicit consent has eroded trust and privacy, with many falling prey to deceptive tactics – lured by promises that are too good to be true. . A few years back, an incident was reported in Mumbai, where a man was allegedly cheated of INR 19,140 by a woman who obtained his credit card details through a 24-minute telemarketing call. This not only tarnishes the reputation of legitimate businesses but also undermines the trust between consumers and the industry as a whole.
Existing regulations, such as those by the Telecom Regulatory Authority of India (TRAI) and Reserve Bank of India (RBI), have attempted to address the issue of Unsolicited Commercial Communication (UCC) but have fallen short in curbing the problem effectively. Despite efforts, the number of complaints regarding UCCs continues to rise, highlighting the need for more stringent regulations.
The DPDP Act as the saviour
However, the scenario is rapidly changing with the introduction of the Digital Personal Data Protection (DPDP) Act – which promises to completely overhaul the consent and data privacy regime between customers and businesses in India.
The implications of the DPDP Act are profound for both businesses and consumers:
For businesses: Compliance with the DPDP Act requires meticulous consent management, ensuring that every promotional call, text, or email is backed by explicit consumer consent. This not only involves operational changes but also a cultural shift towards respecting consumer privacy.
For consumers: The act empowers individuals with control over their personal data. It ensures that consumers have the right to understand why their data is collected and the choice to revoke consent at any time.
Telemarketing and the DPDP Act: 3 Essential changes
The DPDP Act has significant implications for telemarketing. It can’t be business as usual anymore. Companies that use telemarketing as a customer acquisition channel will now need to make 3 key changes.
The first is the need for explicit consent. Under DPDP, companies are required to obtain explicit consent from individuals before initiating contact for promotional activities. This includes maintaining verifiable records of consent, marking a significant shift towards prioritizing consumer autonomy over unsolicited communication.
The second change is the need for rigorous data management practices that align with stringent standards across communication channels such as calls, texts, and emails. Non-compliance attracts heavy penalties.
The third change is the need for customer control over consent. Under the DPDP, the customer needs to be provided mechanisms to grant, revoke or deny consent easily. Currently, consent is collected broadly and not stored in a retrievable, revocable way.
Consent manager to the rescue of telemarketers
How can companies that employ telemarketing respond to these changes? The DPDP Act provides an answer.
The Act envisages the involvement of consent managers. These entities will play a crucial role in bridging the gap between businesses and the need for transparent consent practices.
Consent managers will enable businesses to obtain explicit consent from consumers in a transparent and accountable manner. Additionally, consent managers provide consumers with greater control over their personal data, allowing them to revoke consent at any time and ensuring that their privacy rights are respected.
While companies can probably build their own consent managers – most will likely opt for third-party consent managers. This will enable them to focus on their core business while delegating the management of a robust DPDP compliant consent infrastructure to specialized entities.
Finding common ground
In the difficult business of telemarketing, where consumer trust hangs in the balance, adherence to ethical practices is paramount. By adopting clear consent management and following the DPDP Act, businesses can navigate the changing landscape with honesty, building lasting relationships based on trust and respect
