India Lifts Ban As Mastercard Complies With Data Rules
After the ban of almost one year, finally the RBI lifted the ban from MasterCard & other debit/credit card companies for issuing news cards & adding customers.
Nearly a year after placing the ban, India has lifted the commercial restrictions on Mastercard, allowing the credit card giant to once again add a new customer base in the South Asian segment after it showed satisfactory compliance with the regional data storage laws.
The Reserve Bank of India banned Mastercard, American Express, and Diners Club from offering new debit, credit, or prepaid cards to users in a series of actions last year due to violation with local data storage regulations.
American Express & Diners Club are still unable to conduct business in the nation, although they are nevertheless allowed to continue serving their current clientele.
The local data-storage regulations, which were unveiled in 2018, mandate that payment companies retain all Indian transaction records on local servers.
The US government, Visa, Mastercard, and other companies had previously asked New Delhi to change its regulations because they said they gave the regulator unrestricted supervisory access.
Mastercard, which had an about 33 percent market share in India before the ban, has recognized the nation as a significant growth market and has committed more than $2 billion there over the previous ten years.
According to a statement from a Mastercard representative,
“We appreciate and welcome the Reserve Bank of India’s (RBI) decision from today, which enables us to begin onboarding new domestic clients (debit, credit, and prepaid) into our card network across the nation.
We reiterate our dedication to assisting India, its people, and its companies with their digital requirements, as we have through our collaboration with the RBI.
We are happy to have reached this landmark and will keep up delivery in line with the agreed objectives and legal standards.”
Further MasterCard added,
“India is an important market for us, both in terms of the innovation created here and the value we deliver to our customers and partners.
We take great pride in being able to contribute to the government’s vision of a Digital India and will continue to invest in the country’s future with the same passion and dedication as we always have.”
The local banks including fintech companies will benefit from Mastercard’s return to operations in India.
Many banks escaped trade restrictions from global card companies last year. For example, RBL Bank struggled to switch to Visa and needed weeks to finish.
Only debit or credit cards backed by Visa and Rupay have been available to customers over the past year.
Rupay is a domestic card network developed by the National Payments Corporation of India, a subsidiary of the Reserve Bank of India.