The Reserve Bank of India has lifted the restrictions imposed on American Express Banking Corp. (AEBC) on on-boarding of new domestic customers with immediate effect.
The central bank lifted the restrictions in view of the satisfactory compliance demonstrated by AEBC with RBI’s April 2018 circular on “Storage of Payment System Data.’
The RBI, by order dated April 23, 2021, had imposed restrictions on American Express Banking Corp on on-boarding new domestic customers onto its card network from May 1, 2021.
The central bank then said that the aforementioned entity was found non-compliant with the directions on storage of payment system data. The RBI then said that its order will not impact existing customers.
In its April 2018 circular on ‘Storage of Payment System Data’, RBI asked all system providers to ensure that the entire data relating to payment systems operated by them are stored in a system only in India.
This data should include the full end-to-end transaction details/information collected/carried/processed as part of the message/payment instruction. For the foreign leg of the transaction, if any, the data can also be stored in the foreign country, if required.
RBI had directed system providers to ensure compliance with the aforementioned circular within six months and report compliance of the same to it latest by October 15, 2018.
In June 2022, the central bank had lifted restrictions imposed on Mastercard Asia/Pacific Pte. Ltd. on on-boarding of new domestic customers due to satisfactory compliance demonstrated by the company with its April 2018 circular.
RBI had, by order dated July 14, 2021, imposed restrictions on Mastercard Asia/Pacific Pte. Ltd. on on-boarding new domestic customers (debit, credit or prepaid) onto its card network from July 22, 2021 for non-compliance with its April 2019 circular on “Storage of Payment System Data”.