Mumbai: The Reserve Bank of India (RBI) will implement in full its directive that forces global payment companies to store data locally from this month, a blow to the firms who had lobbied to dilute the measure.
The RBI in April said all payments data should within six months be stored only in the country for “unfettered supervisory access”. The deadline for the companies to adhere is 15 October.
The directive is part of a wider push by India to ask companies to store more of their data locally at a time when governments globally are enforcing more stringent rules to protect user data.
The RBI will not relax the 15 October deadline for global financial technology (fintech) companies to comply with its data localisation norms in the public interest, according to sources. The RBI’s data localisation norms will kick in from Monday.
According to the sources, global fintech companies reportedly sought an extension of the 15 October deadline but it seems that the RBI is not inclined to relax the norms.
Data localisation requires data about residents to be collected, processed, and stored inside the country, often before being transferred internationally, and usually transferred only after meeting local privacy or data protection laws.
Although domestic companies have welcomed the guidelines, global companies fear an increase in their expenses for the creation of local servers.
To avoid this rise in cost, global companies in a recent meeting with the RBI proposed to provide mirror data instead of original data to which the central bank did not agree, the sources said.
Last week, Finance Minister Arun Jaitley met RBI Deputy Governor BP Kanungo to discuss RBI’s data localisation norms. The meeting was also attended by Economic Affairs Secretary Subhash Chandra Garg, Financial Services Secretary Rajiv Kumar and IT Secretary Ajay Prakash Sawhney.
The RBI in April said in order to ensure better monitoring of payment service operators it is important to have unfettered supervisory access to data stored with these system providers as also with their service providers/ intermediaries/third party vendors and other entities in the payment ecosystem.
All system providers shall ensure that the entire data relating to payment systems operated by them are stored in a system only in India, it had said.
The RBI further said data should include the full end-to-end transaction details, information collected/carried/ processed as part of the message/payment instruction.