RBI allows Diners Clubs to add new customers, lifts restrictions imposed in April

On April 23, Diners Club and American Express Banking Corp were banned from issuing new cards for non-compliance with local payment data storage norms. Interestingly, the regulator is yet to lift the ban on American Express. The ban on adding new customers was effective from May 1.

RBI also banned Mastercard from adding new customers with effect from July 22 for failing to comply with its data localization norms. That too is applicable for the time being.

“In view of satisfactory compliance of Reserve Bank of India (RBI) circular dated 6 April 2018 on storage of payment system data by Diners Club International Limited, restrictions have been imposed vide order dated 23 April 2021 on on-boarding to fresh domestic customers. withdrawn with immediate effect,” the regulator said in a statement posted on its website on Tuesday.

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 only one system in India. They were also required to report compliance to the RBI and submit a Board approved System Audit Report (SAR) within the specified time frame. RBI had asked payment service providers to comply with the rules within six months and report compliance by October 15, 2018.

The data to be stored exclusively in India includes complete transaction details; Information collected, transported and processed as part of a message or payment instruction. As per the circular dated April 2018, the audit report approved by the Board was to be submitted by December 31, 2018.

Issuing the directions, RBI said, “To ensure better monitoring, unfettered supervisory access to the data stored with these system providers as well as with their service providers, intermediaries, third party vendors and other entities in the payment ecosystem.” is important.” in 2018.