The Reserve Bank Of India (RBI), on Wednesday, barred Mastercard Asia Pacific from bringing in new customers on its card network from July 22 on account of its failure to comply with the directions issued by the banking regulator on Storage of Payment System Data. The restrictions apply to all kinds of domestic card customers, namely, debit, credit and prepaid.
Issuing a press release, the Reserve Bank instructed Mastercard to advise all card-issuing banking and non-banking institutions to comply with its order. The banking regulator added that despite being given a considerable amount of time and providing adequate opportunities, Mastercard did not comply with the directions.
In a significant relief for Mastercard users, the RBI clarified that existing customers would not be affected due to its order.
In a circular dated April 6, 2018, the central bank had asked the system providers in the country to store all data related to the payments system in India itself within a period of six months. The data required to be stored in the country included full end-to-end transaction details, information collected/carried/processed as part of the message and payment instruction.
Due to non-compliance by Mastercard, the RBI has now taken supervisory action against the company in accordance with its powers under Section 17 of the Payment and Settlement Systems Act, 2007 (PSS Act).
Mastercard is a New york-headquartered Payment System Operator which has been authorised to operate a Card Network in India under the PSS Act.
