Generative AI

Definition

Generative AI refers to artificial intelligence systems that create new content using data inputs, requiring organizations to govern personal data usage responsibly under the DPDPA.

Under the Digital Personal Data Protection Act, 2023 (DPDP Act), Generative AI refers to artificial intelligence systems that generate new content such as text, images, audio, code, or other outputs based on patterns learned from data. When these systems process personal data, organizations acting as Data Fiduciaries must ensure that such processing is carried out in accordance with applicable DPDPA obligations.

Generative AI systems may process personal data during activities such as model training, fine-tuning, user interactions, content generation, or retrieval-based applications. Organizations need visibility into what personal data is being provided to AI systems, the purpose for which it is processed, who has access to generated outputs, and whether appropriate safeguards are implemented. Effective governance helps reduce risks such as unintended disclosure of personal data, excessive data collection, and use beyond the intended purpose.

The DPDP Act does not specifically regulate Generative AI or create separate AI-specific obligations. However, when Generative AI systems process personal data, organizations must comply with relevant DPDPA requirements, including providing appropriate notices, processing personal data for lawful purposes, implementing reasonable security safeguards, protecting Data Principal rights, and preventing Personal Data Breaches.

In practice, gaps emerge when:

Employees use Generative AI tools without understanding whether personal data is being shared.
Organizations lack visibility into AI systems processing personal data.
Personal data used for AI training or prompts is not properly governed.
AI-generated outputs containing personal data are not reviewed appropriately.
Ownership of AI-related personal data processing decisions is unclear.

Organizations address these challenges by establishing AI governance practices, identifying personal data used with AI systems, defining acceptable usage policies, assessing privacy risks, implementing safeguards, and maintaining oversight of AI-related processing activities. Within Privy, capabilities such as data discovery, data classification, data mapping, privacy assessments, governance workflows, and audit-ready reporting help organizations understand and manage personal data usage across AI environments.

Here’s everything you need to know about this term and how it fits into your compliance program.

Still have a question?

The DPDP Act does not specifically regulate Generative AI. However, organizations using Generative AI systems that process personal data must comply with applicable DPDPA obligations.

Generative AI can create privacy risks when personal data is used for training, prompts, processing, or generating outputs without appropriate governance and safeguards.

Personal data may be processed through Generative AI systems when the processing complies with applicable DPDPA requirements, including lawful processing, notice obligations, and security safeguards.

Risks may include unauthorized disclosure of personal data, unclear data usage purposes, excessive data collection, lack of transparency, and insufficient control over AI outputs.

Privy helps organizations discover, classify, and map personal data across environments, enabling better visibility into AI-related data processing and supporting privacy governance.

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