As RBI bans Mastercard, will your debit and credit card work in India?

0


In a blow to the major payment services Mastercard, the Reserve Bank of India (RBI) on Wednesday banned Mastercard Inc from issuing new debit or credit cards to domestic customers indefinitely. Restrictions were imposed on the integration of new domestic customers in the country for violating data storage rules.

The RBI said that despite a considerable time frame and adequate opportunities offered, the entity was found to be non-compliant with the payment system data storage instructions.

In a notification, the RBI said Mastercard failed to comply with 2018 data storage rules that require foreign card networks to store Indian payment data “only in India” so the regulator can have ” unimpeded supervisory access “, adding that” Despite a considerable time lapse given adequate time and opportunities, the entity (Mastercard) was found not to comply with instructions. “

What does this mean for the banks?

Several private sector banks, including HDFC Bank, ICICI Bank, Yes Bank, RBL Bank, have Mastercard connections for debit and credit cards. Thus, banks will no longer be able to issue new cards on the Mastercard network.

RBI has also asked Mastercard to advise banks and non-banks issuing its cards to comply with these instructions.

What does this mean for customers?

If you have a Mastercard credit or debit card, don’t worry. The RBI has made it clear that the latest order will only apply to new customers and existing customers can continue to use it without any issues. “This order will have no impact on existing Mastercard customers,” the central bank said.

Why did RBI go hard on Mastercard?

In accordance with the RBI circular on the storage of payment systems data dated April 6, 2018, all system providers have been ordered to ensure that, within six months, all data relating to payment systems payment systems they operate are stored in a system only in India. .

They were also required to report compliance to the RBI and submit a system audit report approved by the Board of Directors and conducted by an auditor appointed by CERT-In within the time limits specified therein.


Share.

About Author

Leave A Reply