New Banking Law Modernises Records But Leaves Privacy Gaps, Say Experts

The Lok Sabha has passed the Bankers’ Books Evidence Bill, 2026, which seeks to replace the colonial-era Bankers’ Books Evidence Act of 1891. The proposed legislation is designed to modernise the legal framework governing how banking records are produced and accepted as evidence in courts and other proceedings.

Finance Minister Nirmala Sitharaman introduced the Bill in the Lok Sabha on Monday, and the House cleared it on Tuesday. The legislation recognises that banking has moved far beyond physical account books and paper ledgers, with most transactions now recorded, processed and stored through digital systems, databases and electronic platforms.

The 1891 law provides rules for admitting copies of entries from bankers’ books as evidence without requiring banks to produce original records in every case. The new Bill seeks to adapt that framework to contemporary banking practices, where account statements, transaction histories and other financial information increasingly exist in electronic rather than physical form.

Legal experts have welcomed the attempt to update a statute drafted more than a century ago. Recognising modern digital records could make it easier for courts, investigating agencies, banks and litigants to produce and examine financial evidence. It may also reduce procedural difficulties created when an old legal framework is applied to technology-driven banking operations.

However, the proposed law has raised concerns about the protection of sensitive financial information. Bank records can reveal details about a person’s income, spending, relationships and activities. Experts have questioned whether the Bill provides sufficiently strong restrictions on who may access this information and how digital records must be collected, transferred, stored and protected from misuse.

Critics have also described the legislation as a missed opportunity to introduce comprehensive safeguards for authenticity, cybersecurity and privacy. While updating the definition and treatment of banking records is considered necessary, experts argue that modernisation must be accompanied by clear accountability and data-protection standards. The Bill must complete the remaining legislative process before it can become law.