The Reserve Bank of India (RBI) is the central bank which deals with India’s monetary policies and economic stability. It is the regulatory body under the Ministry of Finance, Government of India. RBI has issued master directions related to digital payment security control due to which the customers will now have to remember their card details or carry their card along with them while shopping online or making payments. Earlier they had to just enter the CVV number in order to make payments if the card details were already saved but, now as per the guidelines the customers will have to enter the entire card details such as name of the card holder, card number and expiry date if they wish to pay online.
The new rules of RBI will come into action from july 2021 states RBI’s circular. The guidelines say that e-commerce websites like Amazon and Flipkart etc along with online merchants, payment aggregators such Google Pay, Paytm, Netflix and many others will not be able to store card details of customers.
These guidelines of RBI might create great difficulty for most of us as it’s not possible for everyone to memorize 16 digits debit or credit card numbers. Incase if the customer is using more than one card then it will be a challenge for them to remember the details of each card.
According to the reports RBI receives many complaints regarding fund transfer and UPI transactions. Therefore the Bank has arrived at this decision which restricts third parties from saving customer’s card details so as to prevent the risk of fraud and financial theft.
However the National Association of Software and Service Company (NASSCOM) was against this as it’s difficult for the merchants to resolve customer disputes without the card data. Hence it has suggested RBI to design a framework with security measures, reporting requirements and governance mechanisms store card details.
Around 25 companies like Amazon, Flipkart, Zomato, Netflix, Microsoft expressed their disappointment in the letter to RBI, CNBC TV18 reported. The merchants are concerned that the new guidelines will adversely affect online payments and also they will not be able to use internal tokenisation practice.
The new master directions might reduce online fraud to some extent but it will be very tough for everyone to memorize or carry cards along with them all time for making online payments.