The Reserve Bank of India has banned American Express and Diners Club from onboarding new customers in the country, accusing the firms of violating data storage rules.
Under data storage rules from 2018, all payment system providers were given six months to ensure that full end-to-end transaction details were stored in systems only in India. The rule change was designed to “ensure better monitoring” of data.
American Express – along with Visa, Mastercard, PayPal, Amazon and the US government – lobbied against the rule when it was first introduced.
In a statement, AmEx now says: “We have been in regular dialogue with the Reserve Bank of India about data localisation requirements and have demonstrated our progress towards complying with the regulation.”
The RBI has been flexing its muscles in recent months: in December it banned HDFC from adding new credit card accounts or launching fresh digital banking products over an IT outage.
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