RBI lifts business restrictions imposed on Diners Club

The Reserve Bank of India (RBI) on Tuesday lifted the restrictions imposed on Diners Club International Ltd on onboarding fresh domestic customers.
 
The central bank had in April barred Diners Club from onboarding new domestic credit card customers from May 1 for violating the central bank's norms on storage of payment systems data.
 
"In view of the satisfactory compliance demonstrated by Diners Club International Ltd. with the Reserve Bank of India (RBI) circular dated April 6, 2018 on Storage of Payment System Data, the restrictions imposed...on on-boarding of fresh domestic customers have been lifted with immediate effect," the RBI said in a release.
 
Through a circular dated April 6, 2018, the RBI had directed all payment system providers to ensure that their entire data, including full end-to-end transaction detail, information collected, carried or processed as part of the message and payment instruction, was stored only in India within a period of six months.

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Along with Diners Club, the central bank had also barred American Express from onboarding new domestic credit card customers from May 1 for violating its norms.
 
Later in July, the RBI had restricted global card issuer Mastercard from onboarding new customers in India over non-compliance with data storage regulations. The central bank had said that Mastercard was found 'non-compliant' despite being given adequate opportunities to meet the regulations.
 
The RBI had earlier observed that payments system providers, especially the global players, were storing data of domestic customers outside India.
 
Global companies typically have a centralised system of data storage. Beyond data privacy risks, the risk is of unforeseen global events, which could impact the payments system in India if data is stored outside the country.

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