RBI circular issued in April says that all payment system operators in the country must move to a system of storing transaction data within India by October 5.
The Reserve Bank of India (RBI) has asked payment firms operating in the country to send it fortnightly updates on progress made towards compliance with the central bank’s data localisation norms, a senior Visa executive said.
TR Ramachandran, group country manager for India & South Asia at Visa, said, “They (RBI) have asked us for fortnighly updates on the progress.” He was speaking to reporters on the sidelines of an industry event.
The RBI had, on April 5, put out a circular stating that all payment system operators in the country must move to a system of storing transaction data within India over a six-month period from the date of the circular. The deadline for meeting the norms set out in the circular is October 5.
Asked whether Visa was on track to meet the deadline, Ramachandran said, “Who knows? These are very, very complex projects. Different companies are in different stages (of implementation). I can’t comment on specifically where we are.”
He added that there are many factors to be taken into consideration while implementing the circular. “Different companies have different technology architectures. The reality is we also have to keep data privacy and security and all those things in mind. There is a complex infrastructure,” he observed.
The companies expected to be most affected by the circular are the Indian branches of Amazon, Mastercard, Visa, Truecaller and Whatsapp. The last few months have seen furious lobbying by industry players with the central bank. While some companies have sought an extension of the deadline, others have pleaded that they be allowed to maintain details of payment transactions offshore while mirroring it within India.
So far, RBI has not announced any modification to the April circular. Some Indian firms, such as One97 Communications-owned Paytm, have spoken in support of the circular.
Compliance with the data localisation circular may turn out to be crucial to some players’ digital payments foray. For instance, State Bank of India (SBI) is understood to have put on hold its decision to join Whatsapp’s payments platform pending full compliance by the Facebook arm.