New Delhi: The Reserve Bank of India (RBI) on Wednesday imposed restrictions on Mastercard Asia / Pacific Pte Ltd (Mastercard) from onboarding new domestic customers (debit, credit or prepaid) onto its card network from 22 July. “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.
It is important to note that the order will not impact existing customers of Mastercard. Mastercard shall advise all card-issuing banks and non-banks to conform to these directions. The supervisory action has been taken in exercise of powers vested in RBI under Section 17 of the Payment and Settlement Systems Act, 2007 (PSS Act), the RBI said. Mastercard is a Payment System Operator authorised to operate a Card Network in the country under the PSS Act.
According to RBI, the directions will not impact existing customers of Mastercard. “Mastercard shall advise all card issuing banks and non-banks to conform to these directions”. In terms of its circular on Storage of Payment System Data on April 6, 2018, all system providers were directed to ensure that within a period of six months the entire data relating to payment systems is stored only in India, as per the central bank.
Mastercards becomes the third major Payment System Operator on which restrictions have been imposed for non-compliance with RBI”s direction on Storage of Payment System Data.
Earlier, RBI had restricted American Express Banking Corp and Diners Club International Ltd from onboarding new domestic customers on to their card networks from May 1 for violating data storage norms.
In April 6, 2018, the RBI had directed all Payment 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 is stored in a system only in India.
They were also required to report compliance to RBI and submit a board-approved System Audit Report conducted by a CERT-In empanelled auditor within specified timelines.
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