Visa, Mastercard, Amex let RBI’s data localisation deadline pass
16 Oct 2018
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US credit card majors Visa, Mastercard and Amex have decided to let pass a Reserve Bank of India deadline to move all financial data collected within the country to this country and instead pay the penalty that RBI may demand.
These companies that include American Express, Mastercard, PayPal and Visa, however, have not decided against complying with the RBI requirement and instead sought more time for compliance.
“The companies that are yet to comply have asked for more time to set up local data centres. Of the 15 players, four international players — American Express, Mastercard, PayPal and Visa — have shown intent to comply and submitted a roadmap to the banking regulator on how and when they intend to set up a data centre in the country,” reports quoting top banking sources said.
But, with the RBI also sticking to its 15 October deadline to ensure storage of local data locally, it is now more or less sure that these payment companies will have to shell out penalties for failure to comply with the RBI directive.
RBI has not made it clear what action it may take against companies that have not yet complied with its April order, but banking sources say it is unlikely that RBI would do anything that would disrupt payment services.
Visa, Mastercard and Amex did not comment for this story. PayPal said it does not comment on regulatory aspects.
RBI had, in April, issued a directive to payment service companies to store financial data of Indian users within the country in the wake of instances of data theft and cyber financial frauds.
RBI had also given payment players, both domestic and international, time toll 15 October to comply with the directive.
Most of the Indian payment companies and global tech companies offering payments — Alibaba, Amazon Pay, WhatsApp, Google Pay — have complied with the requirements.
Of the 75 payment service providers about 60 have complied with the RBI directive and only 15 are yet to comply.
It may be noted that the companies that refuse to comply, including Mastercard, Visa and American Express, still dominate the payment ecosystem and they think RBI will adjust to their requirements.
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