The Reserve Bank of India (RBI) on Wednesday barred Mastercard Asia/ Pacific Pte. Ltd. (Mastercard) from onboarding new domestic customers -- debit, credit or prepaid -- over violation of central bank's directions on storage of payment system data. The prohibition will be effective July 22. Through a circular dated April 6, 2018, RBI had directed all system providers to ensure that within a period of six months the entire data -- full end-to-end transaction details/ information collected/ carried/ processed as part of the message/ payment instruction -- relating to payment systems operated by them was stored in a system only in India. "Notwithstanding lapse of considerable time and adequate opportunities being given, the entity has been found to be non-compliant with the directions on Storage of Payment System Data," RBI said in a release.
Also Read: Infosys reports Q1 profit at Rs 5,195 cr; misses expectations It also asked Mastercard to advise all card issuing banks and non-banks to conform to the central bank's directions. However, RBI clarified that the order will not impact the existing customers of Mastercard. Mastercard is a Payment System Operator authorised to operate a card network in the country under the Payment and Settlement Systems Act, 2007 (PSS Act). As per RBI's 2018 circular, all system providers were also required to report compliance to RBI and submit a board-approved system audit report conducted by a CERT-In empanelled auditor within the specified timelines. The supervisory action was taken in exercise of powers vested in RBI under Section 17 of PSS Act, the release said.
Responding to RBI's order, Mastercard said it is fully committed to its legal and regulatory obligations. The company said it provided consistent updates, reports regarding activities and compliance with data storage norms to RBI, CNBC-TV18 reported.
"While we are disappointed with RBI stance, we continue to work with them to resolve concerns," Mastercard said, adding that it has considerable and continued investments in India. The company is committed to working with customers, partners to advance government's 'Digital India' vision, it said.
Also Read: IITs, NITs to roll out tech courses in Indian languages from next academic session