TL;DR (for busy founders)
Under the DPDP Act, a Privacy Policy explains how personal data is processed, while Consent is permission to process data for a specific purpose. They serve different legal functions and are not interchangeable. Most compliance failures occur when businesses confuse the two.
Introduction
One of the most common mistakes Indian businesses make under the Digital Personal Data Protection Act, 2023 (DPDP Act) is treating privacy policies and consent notices as the same thing.
They are not.
While both relate to personal data processing, they serve distinct legal purposes. Confusing them can lead to:
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Invalid consent
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Inadequate transparency
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Increased regulatory and reputational risk
This article explains the difference between consent and privacy policy under DPDP, in simple, practical terms—especially for startups and SMEs.
What Is a Privacy Policy under DPDP?
A Privacy Policy is a transparency document.
Its purpose is to inform individuals (Data Principals) about how their personal data is handled.
A DPDP-aligned Privacy Policy typically explains:
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What categories of personal data are collected
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The purpose of data collection
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How the data is used and stored
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Data retention principles
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Data Principal rights
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How grievances or requests can be raised
The privacy policy answers one core question:
“What are you doing with my personal data?”
It does not ask for permission.
It provides clarity and disclosure.
What Is Consent under DPDP?
Consent is a legal permission to process personal data for a specific purpose, where DPDP requires such permission.
Under DPDP, valid consent must be:
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Free
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Informed
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Specific
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Unambiguous
Consent is transactional and purpose-bound.
It answers a different question:
“Do I agree to my data being used for this specific purpose?”
Why Privacy Policy and Consent Are Not the Same
Many businesses attempt to:
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Add consent language inside a privacy policy
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Assume acceptance of a privacy policy equals consent
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Collect blanket consent for all processing
This approach is risky.
Key distinction:
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Privacy Policy = Explanation
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Consent = Permission
A person can:
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Read a privacy policy without consenting
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Withdraw consent without invalidating the privacy policy
They operate independently.
When Is Consent Required under DPDP?
DPDP does not mandate consent for every instance of data processing.
Consent is required when:
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The law specifies consent as the lawful basis
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Processing is not otherwise permitted by law
Unnecessary consent collection can:
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Create operational friction
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Lead to consent fatigue
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Increase compliance complexity
SMEs should be careful not to overuse consent where transparency alone is sufficient.
Common Mistakes Businesses Make
1. Treating Privacy Policy Acceptance as Consent
Accepting a privacy policy only confirms acknowledgment, not permission.
2. Bundling Consent with Terms
Consent must be specific and granular, not buried inside unrelated agreements.
3. No Withdrawal Mechanism
DPDP requires that consent can be withdrawn as easily as it is given.
4. Using Generic Consent Language
Consent must clearly state:
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What data
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For what purpose
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For how long
Vague language weakens validity.
How SMEs Should Approach This Practically
A simple, defensible approach for SMEs:
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Maintain one clear privacy policy explaining data practices
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Use separate consent notices only where legally required
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Keep consent language short and purpose-specific
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Maintain records of consent where applicable
This approach reduces risk without overengineering compliance.
Why This Distinction Matters in Practice
Most DPDP complaints and escalations arise from:
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Confusion
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Poor communication
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Misaligned documentation
Clear separation between transparency and permission significantly lowers exposure.
DPDP compliance is not about collecting more documents—it’s about using the right document for the right legal purpose.
Closing Thought
Privacy policies and consent notices are complementary—but not interchangeable.
Understanding the difference is one of the simplest yet most impactful steps an organisation can take towards DPDP readiness.
Related Resource
DPDP360™ provides structured templates for both privacy notices and consent mechanisms, designed to help Indian SMEs implement DPDP requirements clearly and proportionately.
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