Last Updated on 14/07/2021 by Riya
Due to violation of domestic data storage standards, the Reserve Bank of India has stopped Mastercard from granting new debit, credit, or prepaid cards to users in the Indian market for an unspecified period. The ban will come into force on July 22nd. The company has been proven to be non-compliant with the guidelines on Preservation of Payment Processing Information despite giving the significant amount of time and ample chances RBI said in a statement on Wednesday.
ith the news of ban the tension arises amongst the existing MasterCard customers as several people use MasterCard in India however, RBI made it clear that the new regulation will not influence current Mastercard users, who are among India’s three leading card providers According to RBI, “Mastercard must notify all card approving banks and non-banks to comply with these instructions.” Although it is assumed that this restriction will benefit the UPI companies by allowing them to offer their service to a wider audience.
RBI has also punished a company for failure to obey domestic data guidelines earlier, which were introduced in 2018 and needed conformity in six months. Financial institutions must keep all Indian transaction records on databases in India, according to the guidelines. Furthermore, The RBI has also barred American Express and Diners Club for accepting new clients in April, claiming a breach of similar guidelines.
Several companies including MasterCard, Visa, etc., and the US administration, have already asked the Central government to modify its guidelines, claiming to provide the authority “unrestricted monitoring power. “Global payment card businesses suffer losses as a result of India’s United Payments Interface, which enables cashless payment choices via a mobile device, capturing more customers’ attention. In June 2021, it is estimated that over 2.8 billion UPI payments worth 5.5 trillion rupees ($73.8 billion) were processed. Following this restriction, it is likely that the coming days would be extremely difficult for these companies in India if they do not comply with Indian RBI regulations.
