Paytm drops PoS feature on app on security concerns
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New Delhi: Online payments firm Paytm on Thursday withdrew a point of sale (PoS) feature it introduced in its mobile app just a day earlier.
The feature was withdrawn after several banks raised possible security concerns about the feature with the Reserve Bank of India (RBI), two people familiar with the development said.
The company was asked to address security concerns and relaunch it after these concerns were met, these people said, requesting anonymity.
Paytm, run by One97 Communications Pvt. Ltd, had on Wednesday introduced App POS, a feature that could allow a merchant’s smartphone to act as a point of sale machine, accepting payments through debit and credit cards. The new feature was largely aimed at people who have a debit card but do not necessarily have access to a smartphone.
“Post our launch, we have had several discussions with stakeholders on how we can make this process even more secure. Based on some suggestions from the industry, we have decided to add additional certifications and features before making it available to merchants. We will re-launch this product as soon as we have updated the product,” Paytm said in a blogpost Thursday.
Paytm did not reveal any more details.
While announcing the feature, Paytm had said that this would help small merchants to accept card payments by allowing a consumer to key in their debit/credit card details in the Paytm app on the merchant’s smartphone. It has a three-step authentication process, just as in normal card use at a PoS.
Paytm senior executives on Wednesday had said that the feature was PCI-DSS compliant and would not store the card details of a consumer within the app. The Payment Card Industry Data Security Standard (PCI DSS) is an information security standard for organizations that handle branded credit cards from the major card schemes including Visa, MasterCard, American Express, among others.