By Anupam Shukla
The surge in interest experienced by edtech players in the past few months is truly astounding. As schools struggle to reopen, parents are happy keeping their children indoors, in front of a smartphone or a laptop. Private equity and VC funding in edtech sector in India has shot up to $1.5 billion as of September 2020 – a 4x increase over investments in 2019! A survey by 100X. VC, a sector-agnostic early stage investment platform, found edtech to be one of the most preferable sectors in India for investors.
India has one of the largest student populations in the world. As per IBEF’s Indian Education Sector Industry Report of August 2020, India has already become the second largest market for e-learning in the world, after the US. With widespread availability of budget smartphones and inexpensive internet plans in India, the massive potential of digital learning platforms is not lost on investors, entrepreneurs and the government. The recently published National Education Policy 2020 also stresses on integration of technology across classrooms and proposes creation of an autonomous body, the National Educational Technology Forum, to provide a platform for the free exchange of ideas on use of technology to enhance learning.
Education sector in India is highly regulated. Most of these regulations apply to traditional educational institutions providing K-12 or higher education. Private bodies providing ancillary educational services like coaching, entrance exams training, complementary learning, mock testing etc. have generally been outside the purview of such regulations. However, in the recent past, certain states like Telangana, Andhra Pradesh, Karnataka, UP, Goa etc. have started implementing laws regulating such ancillary educational service providers while states like Maharashtra and Rajasthan have constituted committees to draft legislation in this regard. As the digital education sector continues to grow, the government may also seek to regulate edtech platforms in a similar manner, to protect the rights and interests of the students.
Majority of the edtech players in India focus on K-12 curriculum and competitive exams training and most of their customers are minors. Under Indian laws, minors (i.e. individuals below the age of 18) are not competent to enter into contracts. Therefore, the edtech service providers need to ensure that they enter into appropriate binding documentation with the parents or legal guardians of the students, to be able to enforce the terms, conditions and policies for use of their platforms.
The impending Personal Data Protection Bill, 2019 mandates the institution of an age verification process and a mechanism for seeking parental consent for collection of minor’s personal data. In case of noncompliance with this provision, the Personal Data Bill proposes substantial monetary penalties on the entity in breach. Till such time as the Personal Data Bill is enacted into law, the edtech companies will have to continue to comply with the existing data protection laws in India under the Information Technology Act, 2000 and rules thereunder. If the edtech platforms also cater to students based abroad (especially in US or EU) then the data protection laws of such jurisdictions will also apply to such edtech companies.
The recently enacted Consumer Protection (E-Commerce) Rules, 2020 impose certain compliances on e-commerce entities viz. payment methods, refunds, advertising standards etc. edtech companies providing or facilitating services for a fee would be considered “e-commerce entities” and would have to comply with the provisions of the E-Commerce Rules.
In recent times, schools have taken various steps to ensure physical safety and mental wellbeing of their students by implementing suicide prevention policies, appointing counsellors, overhauling security infrastructure etc. Provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and Protection of Children from Sexual Offences Act, 2012 are strictly implemented. As the number of students opting for online education continue to increase, considering the substantial time spent by such students on the platform- interacting with instructors and other students or accessing digital content, both live and pre-loaded, the edtech companies will have to start implementing similar policies and procedures to ensure safety and wellbeing of the users. Prevention of cyberbullying, monitoring content for material unsuitable for minors, ensuring protection of students from cyberattacks or phishing scams, screening of teachers/ instructors/ content creators, etc. becomes the responsibility of the edtech companies.
With the shift in acceptable modes of dissemination of education in the post-COVID landscape and the larger role now played by edtech platforms, the legal responsibilities on such platforms will continue to rise in the near future and they will have to take suitable measures and implement adequate procedures in this regard. Failure to do so, may expose the edtech companies to liabilities.
The author is a Counsel at Pioneer Legal.