Mastercard Barred By RBI From Adding New Clients In India From July 22
The Reserve Bank of India (RBI) on Wednesday imposed restrictions on Mastercard from onboarding new domestic customers on its network from July 22, 2021 onwards.
The payment system operator has been barred from adding domestic customers under all the three categories of debit, credit as well as prepaid.Â
The action has been taken against Mastercard for violating the central bank's norms on storage of payment systems data, the RBI said in a statement.
At the same time though, the statement added that the order will not have any impact on Mastercard's existing customers and the company will have to inform all card issuing banks as well as non-banks to conform to RBI's directions.
The central bank said that despite lapse of considerable time and adequate opportunities having been given to Mastercard, it was found to be non-compliant with its directions on "Storage of Payment System Data".
Through a circular issued in April 2018, RBI had asked all payment system providers to ensure that within a period of six months their entire data related to payment systems (like end-to-end transaction details among other requirements), which is operated by them, is stored in a system only in India.
Mastercard failed to comply with these conditions.
Earlier this year, RBI had taken similar action against American Express and Diners Club and had barred them from adding new domestic credit card customers from May 1, 2021 onwards.
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