RBI Gives A Big Blow To Mastercard, Ban On Adding New Customers
RBI has barred Mastercard from adding new customers to its network with effect from July 22, 2021.
New Delhi. The RBI has given a big blow to the payment and technology company Mastercard. RBI has barred Mastercard from adding new customers to its network with effect from July 22, 2021. This action by RBI is related to payment systems in India for non-compliance with the rules for storing data. It is worth noting that this action has been taken on Mastercard Asia and Pacific Pte Ltd.
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Companies will not be able to take Mastercard cards
This action is not going to affect the existing customers. RBI in its order has asked all card issuing banks and non-banks to follow this instruction. Banks or other finance companies that issue debit or credit cards are prepared by some companies. These companies make these cards, among them Mastercard is also said to be included. Now banks and non-banking companies will not be able to accept Mastercard cards.
What are the rules of RBI
In its circular on storage of payment system data dated April 6, 2018, RBI had directed all system providers to collect payment system data within six months only in India. Mastercard has become the third major payment system operator to be banned by RBI for non-compliance with the instructions on storage of payment system data.
Which companies have been banned
Earlier, the RBI had restrained American Express Banking Corp and Diners Club International Ltd from adding new domestic customers to their card networks with effect from May 1 for violating data storage norms. All the data related to the payment system will now be collected only in India. RBI has given clear instructions for this.
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2 foreign financial institutions were banned
According to RBI, in April, two foreign financial institutions were banned from issuing cards to new customers. Among them, America Express Banking and Diners Club International Limited are banned from issuing cards to new customers from 1 May.
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