No ‘continuous consent’ for apps; Byju’s $1.2 bn loan terms to be amended

By Daisy On Jul 25, 2023

The government is planning to do away with the concept of ‘continuous consent’ for applications and digital services by making it mandatory for companies to obtain consent every time. Currently, such firms obtain consent only initially when a user signs up for the service, and then they continue to process the data as required. This and more in today’s ETtech Morning Dispatch.

Also in this letter:
■ Lending firm Oxyzo enters marketplace biz
■ Twitter is now called X
■ TCS CEO on UK’s contribution to revenues

Govt may do away with ‘continuous consent’ for apps, services

Soon, companies dealing in personal and non-personal data might have to ask for their users’ consent every time they tweak the terms and conditions, update their services, or change the way user data is processed, instead of obtaining it only once in the beginning, sources told ET.

Driving the news: Officials told ET that a clause to this effect may be introduced in the Digital India bill, the draft of which is to be released soon for public consultation. This would do away with the concept of ‘continuous consent’ where apps and services obtain permissions to process data from the users only initially when they sign up for the service.

Quote, unquote: “The current process is unfair because companies keep changing the way they process data collected from the users. Users must be aware at all times how their data is used,” the official said.

Informed consent: According to the draft Digital Personal Data Protection (DPDP) bill, any request for processing data should be accompanied or preceded by “an itemised notice” containing the description of the personal data being collected and the ways in which the data can be used, in “clear and plain language”.

Second shot: The government has introduced the DPDP bill in the ongoing monsoon session of parliament for discussion and it is likely to be taken up for passage soon, an official said. This will be the government’s second attempt at passing the bill after an earlier version was withdrawn last year.

Byju’s, lenders aim to strike new pact for $1.2 billion loan by August 3

The ad hoc steering committee of Byju’s lenders, which collectively owns more than 85% of the edtech’s $1.2 billion term loan B, said that both parties would work towards having an amended agreement in place by August 3.

Also read | Byju’s lenders open to negotiations, seek draft loan amendment proposal

You read it here first: ETtech broke the news of Byju’s and its lenders reaching an agreement on the term loan on July 24.

Why it matters? “Successful execution of the amendment would immediately resolve the (matter of the) loan’s acceleration, and end all open litigation, while avoiding further enforcement actions,” the lenders’ group said in a statement.

Legal trouble: Both Byju’s and its lenders had moved court in the US over the term loan. In fact, the same group of lenders had called Byju’s lawsuit in New York ‘meritless’.

Also read | Consortium of Byju’s lenders extends pact to deal with edtech jointly: report

What’s in it for Byju’s? A formal agreement is crucial for the edtech major as its differences with lenders over the loan have been a key pain point. The company has been embroiled in a series of crises of late, including the resignation of its auditor, and representatives of its three key investors from the board.

Oxyzo expands into marketplace business

Prashant Roy Sharma, head of corporate finance at Oxyzo

Financial services startup Oxyzo started off as a purchase finance platform to support buyers transacting on the B2B marketplace OfBusiness. It has now entered a new line of business, acting as an intermediary between lenders and small and medium enterprises (SMEs).

New biz: In partnership with some banks, non-banking lenders, corporate houses and family offices, it is placing close to $200 million (Rs 1,630 crore) of structured debt every month on a debt marketplace it has set up for SMEs. Oxyzo earns a commission for this service.

Why this foray? Currently, Oxyzo offers around Rs 400-600 crore of debt funding through non-convertible debentures to customers on the debt financing platform. The platform opens up the capital market to mid-size SMEs, a market that would’ve been otherwise out of bounds for them.

With this, Oxyzo is catering to the larger credit requirements of its clients, and is generating a fee income for the OFB Tech group.

Disrupting relationships: The business of providing supply chain and working capital funding has traditionally been driven by relationships between business owners and local branch managers of banks or NBFCs.

Oxyzo is trying to digitise this space and grab a small chunk of this large corporate debt market, which could easily see disbursals of up to $1 billion every month, said industry insiders. Debt marketplace Yubi also offers such a service.

Elon Musk: Twitter is now X

Tesla chief Elon Musk has transformed Twitter since taking it over last November, and made over many things at the microblogging site, except for its iconic bird logo, because birds tweet, right? However, that has changed now.

Also read | Bird has flown as Elon Musk, Twitter CEO Linda Yaccarino say ‘X’ logo is here

Shift to X: Musk, who also happens to be the CEO of SpaceX, announced on Sunday that the company will be rebranded as X. Later, Twitter’s newly crowned CEO Linda Yaccarino tweeted saying that X will move into payments, banking, and commerce.

On Monday, the old blue bird logo, named Larry Bird after the Boston Celtics basketball legend, was replaced by X. Musk said the company was “Going with (a) minimalist art deco” logo, and that “X.com now points to twitter.com.”

Also read | Who is Linda Yaccarino, the new CEO of Twitter?

Changes at Twitter: The list of changes after Musk took over the reins is long, ranging from appointing a new CEO, to slashing headcount, to launching a subscription service allowing users to buy the once-coveted blue tick for $8 a month, to allowing users to monetise content. More recent changes include Musk limiting the number of tweets one can access per day, as well as a change in the company’s policy on DMs.

Mega orders from UK help TCS ride out macro storm

K Krithivasan, CEO and MD , TCS

Mega orders from the likes of the Phoenix Group and Nest have made the UK a vital cog in revenue growth at Tata Consultancy Services, amid global macroeconomic headwinds and subdued demand. Currently, the UK makes up a sixth of the revenue of India’s largest software exporter.

CEOspeak: “As a market, we find the pressure on (cost) efficiencies is less in the UK because maybe they have been facing uncertainty for a longer period of time,” said TCS CEO K Krithivasan. “They know what they’re going to spend, and which programmes will continue, compared with other markets where these uncertainties have cropped up over a quarter or two.”

Also read | Will 2023 be a lost year for IT?

Contingency plans: Krithivasan told ET that the reason why UK firms are continuing to invest in the future, unlike their counterparts elsewhere in the developed world, may be attributed to London’s likely contingency plans for business disruptions spawned by Britain’s exit from the European Union three years ago.

Data decoded: During the first quarter of 2023-24, TCS’s UK business reported a 16.1% on-year growth in constant currency terms, compared with 3.4% growth in continental Europe, and 4.6% growth in North America. Europe’s share in TCS’ revenue stands at 15%, while the US leads with a 52% share.