Mater Card ban by RBI and it’s impact on major banks including SBI
5 big banks like SBI, AXIS have been hit hard by RBI banning Master Card and the biggest one will be RBL Bank, YES Bank and Bajaj Finserv as these banks were completely dependent on Master Card.
New Delhi. MasterCard was banned by the Reserve Bank of India citing data storage related rules. That is, now all banks have been barred from issuing new master cards, which include debit cards, credit cards and other prepaid cards. After this decision of RBI, the problems of those banks which have been completely dependent on MasterCard have increased a lot. Those banks now have to switch to other cards which include Visa and RuPay cards, but it will take a long time for banks to switch to these cards.
rbi imposed ban on master card
RBI had banned Master Card for not following the rules related to users’ data. In the circular issued by the RBI to all the banks, it was clearly asked not to issue any new master cards from July 22 onwards. RBI has taken this action on the basis of circular issued on 6th April 2018 on Master Card Asia Pacific.
According to RBI, the circular was issued on April 6, 2018 regarding the maintenance of payment system statistics. Accordingly, all the concerned service providers were directed to ensure that they make arrangements to keep all the data related to the payment system within the country only within 6 months. Master Card is an American company that was not following the rules here, for which there has been a dispute between the government and these payment companies even before this.
These banks will have a direct impact
The ban on MasterCard will affect both public and private banks. If we talk about private banks then it includes Axis Bank, Indsuind Bank, Yes Bank. On the other hand, government banks include Bajaj Finserv apart from including SBI Bank. It is worth noting that if RBL Bank, Bajaj Finserv and Yes Bank are completely dependent on MasterCard, then they are going to face a lot of trouble. However, other banks do not fully use MasterCard and their customers may have less hassle.
These banks will not be affected
There will be more impact on RBL Bank and Yes Bank, but there are many big banks like HDFC Bank and Kotak Bank which will not be affected. On the other hand, if we talk about ICICI Bank, Yes Bank and IndusInd Bank, then these banks depend on MasterCard from 35 to 40 percent. SBI Bank depends on Master Card only up to 10%, so this ban of RBI will not have much effect on it.
The government is very serious on topics like data collection, that is why it has already been asking all foreign companies to follow the rules and is not shying away from taking action against those companies who are not obeying.
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