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Business News/ Industry / Banking/ Amex, Diners Club barred from adding new customers

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Amex, Diners Club barred from adding new customers

1 min read 23 Apr 2021, 08:03 PM IST Join us

Shayan Ghosh

Through its circular on Storage of Payment System Data in April 2018, the central bank had directed all payment system providers to ensure that their entire data on payment systems is stored in a system only in India

FILE - Data to be stored exclusively in India include complete end-to-end transaction details; information collected, carried and processed as part of the message or payment instruction (AP) — FILE - Data to be stored exclusively in India include complete end-to-end transaction details; information collected, carried and processed as part of the message or payment instruction **(AP)**

Mumbai: The Reserve Bank of India (RBI) on Friday asked global card payment networks American Express Banking Corp. and Diners Club International Ltd not to on-board new customers due to non-compliance of localized payment data storage norms. “This order will not impact existing customers," the regulator said.

American Express and Diners Club are payment system operators authorized to operate card networks in India under the Payment and Settlement Systems Act, 2007 (PSS Act). The ban on adding new customers will be effective 1 May, RBI said on Friday.

“While we are disappointed that the RBI has taken this course of action, we are working with them to resolve their concerns as quickly as possible," American Express said in an emailed statement.

In its circular on “Storage of Payment System Data" in April 2018, the central bank had directed all payment system providers to ensure that their entire data is stored in a server only in India. They were also required to report compliance to RBI and submit a board-approved system audit report within the timelines specified.

RBI had asked payment service providers to comply with the regulations within six months and report by 15 October 2018. Data to be stored exclusively in India include complete end-to-end transaction details, information collected, carried and processed as part of the message or payment instructions.

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ABOUT THE AUTHOR

Shayan Ghosh

Shayan Ghosh is a national writer at Mint reporting on traditional banks and shadow banks. He has over a decade of experience in financial journalism. Based in Mint’s Mumbai bureau since 2018, he tracks interest rate movements and its impact on companies and the broader economy. His interests also include the distressed debt market, especially as India’s bankruptcy law attempts recoveries of billions worth of toxic assets.