RBI: Reserve Bank of India bans Amex, Diners from selling new cards from May 1
The action has been take as these entities have been found non-compliant with the directions on storage of payment system data which the central bank had asked them to store in India, RBI said.
“In terms of RBI circular on storage of payment system data dated, all payment system providers were directed to ensure that within a period of six months the entire data (full end-to-end transaction details/information collected/carried/processed as part of the message/payment instruction) relating to payment systems operated by them is stored in a system only in India. They were also required to report compliance to RBI and submit a voard-approved system audit report (SAR) conducted by a CERT-In empanelled auditor within the timelines specified therein,” RBI said.
This order will not impact existing customers.
American Express had 1.56 million credit cards outstanding in India as of February the second highest among foreign lenders in India behind Citibank.
“We have been in regular dialogue with the Reserve Bank of India about data localization requirements and have demonstrated our progress towards complying with the regulation. While we’re disappointed that the RBI has taken this course of action, we are working with them to resolve their concerns as quickly as possible. This does not impact the services that we offer to our existing customers in India, and our customers can continue to use and accept our cards as normal,” American Express said in a statement.
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