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Why Dealership Owners Must Prioritise DPDPA Compliance

  • By Readywire
  • January 27, 2025
  • 76 Views

The Digital Personal Data Protection Act (DPDPA) is set to transform how dealerships manage personal data. This landmark legislation introduces stringent regulations on the collection, processing, and storage of personal information. Draft rules are open for consultation until February 2025, and implementation is expected within 24 months, so dealerships have a narrow window to prepare. The urgency to act cannot be overstated, as compliance will demand significant changes to existing systems and processes.

Understanding What DPDPA Requires

DPDPA mandates that organisations collecting personal data obtain explicit consent from employees and customers, promise to use the data solely for its stated purpose, and ensure it is kept secure. This means dealerships must:

  • Identify and secure all personal data.
  • Eliminate manual, paper-driven processes.
  • Transition to fully digitised operations.
  • Implement unified systems that streamline compliance and mitigate risks.
  • Conduct regular audits and implement real-time monitoring to prevent breaches.

The act doesn’t stop at mandating these steps. Dealerships must ensure verifiable consent for every data collection instance and maintain a robust system to secure and monitor data usage. Without these measures, compliance will remain out of reach.

The Cost of Non-Compliance

Non-compliance comes with steep penalties. Government-imposed fines can run into tens of crores of rupees, but the financial risks extend beyond these fines. Customers or employees can initiate lawsuits if data is mishandled under false promises of security. These lawsuits can lead to significant legal expenses, reputational damage, and operational disruptions. Dealerships must treat compliance as a regulatory requirement and a vital business strategy to avoid these risks.

Why Digitisation Is the Only Way Forward

Compliance with DPDPA is only achievable through comprehensive digital transformation. This means replacing manual processes and fragmented systems with integrated, end-to-end digitisation. A unified system ensures seamless operations, accurate data handling, and secure storage. However, implementing such a transformation requires:

  • Careful planning and strategy.
  • Correct application of digitisation to align with dealership workflows.
  • Training employees to adapt to new systems.

It’s not a process that can be rushed or achieved overnight. Starting early is critical to ensure a smooth transition and compliance within the mandated timelines.

The Benefits of Acting Now

Dealerships that act proactively will position themselves as leaders in the industry. By embracing digitisation today, they can:

  • Ensure full compliance and avoid penalties.
  • Enhance operational efficiency, reducing costs and errors.
  • Improve customer experiences by offering transparent, secure, and efficient processes.
  • Build trust with both customers and employees.
  • Future-proof business against evolving regulations.

Conversely, delayed action risks leaving dealerships unprepared and struggling to catch up in an increasingly stringent regulatory environment.

A Pivotal Moment for Dealerships

DPDPA represents a significant turning point for the automotive dealership sector. It’s not just about adhering to regulations; it’s about building a secure and sustainable future. Dealerships embracing this transformation will emerge stronger, better equipped to navigate the demands of a data-driven world, and ready to lead the industry into a future of accountability and excellence.

Now is the time to act—to prepare, transform, and thrive in this new era of data protection.

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