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Amazon’s UPI payment service stuck over local data storage concerns

The e-commerce giant is in talks with the Axis Bank to start issuing UPI handles to users of Amazon Pay.

August 06, 2018 / 12:19 PM IST

After WhatsApp, now Amazon’s plan to launch its own UPI payment service in India is also stuck due to concerns around the storage of data within the country, according to a report by The Economic Times. 

The Facebook-owned messaging app WhatsApp and Amazon are keen on entering payments space in India through inter-bank fund transfer railroad UPI. They both, however, are now waiting for more clarity on data storage from the Reserve Bank of India (RBI), two bankers aware of the development told the paper on condition of anonymity.

"Both WhatsApp Payments and Amazon Pay have not gone live due to similar reasons,” one of the bankers told the paper, adding that they will have to wait for the final decision on the draft Personal Data Protection Bill, which is being put out for consultations.

According to the report, the e-commerce giant is in talks with the Axis Bank to start issuing UPI handles to users of Amazon Pay.

Earlier this year, Amazon had introduced UPI as a mode of payment on its website. “We are excited about UPI as it democratises the payments experience for banked customers by simplifying mobile payments across more than 50 banks and powering use cases like money transfers,” an Amazon spokesperson said in a written reply to the paper.


In April, the Reserve Bank of India released guidelines asking all payment system operators to ensure that data is stored only within the country, and comply with the order by October 15, 2018. While financial data need to be stored in India, the companies are trying to understand whether they will be allowed to keep a copy of data outside the country.

The finance ministry had recently proposed relaxing the directive from the country’s central bank to compel global payment firms to store customer data locally.

The proposal was seen as a relief for companies including MasterCard, Visa and American Express that fear India’s data on-shoring move could cost them millions of dollars. It also set a precedent for other major governments to implement similar rules at a time when there is heightened scrutiny on how companies globally handle their customers’ data.

The central bank, however, is yet to come out with a clarification circular to settle the issue.

“Till that happens the limbo will continue,” one of the bankers told the paper.

As per the recommendations proposed by the Srikrishna Committee on data privacy and protection, the critical personal data can only be stored in servers located in the country.

The RBI's guidelines on storage of data comes at a time when India has been recording a constant rise on digital payment. As per figures released by NPCI, there were 235 million UPI transactions involving Rs 45,845 crore as of July.

The RBI had said that to ensure better monitoring, 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.

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