RBI’s data localisation rule, however, seems to be one of the major hurdles for most of the multinational companies including Mastercard, Visa, Amazon, WhatsApp and PayPal to launch a payment platform in India.
Tech giant Apple has dropped plans to launch a Unified Payments Interface-based payments platform in India owing to the country's rule on data storage.
Apple's decision comes after the company held discussions with the National Payments Corporation of India, which manages the UPI platform as well as a few leading banks, reported The Economic Times quoting two people aware of the development.
“Apple will not launch payments in India yet. They are waiting to see how the regulatory landscape shapes up,” one of the person quoted above told the paper.
In April, the Reserve Bank of India had released guidelines asking all payment system operators to ensure that data is stored only within the country, and asked them to comply with the order by October 15, 2018. This turns out to be one of Apple's major concerns.
The company also faced some technical and design hurdles related to the flow of payments on UPI. Apple wanted fingerprint as a mode of authentication for UPI payments, which did not comply with NPCI guidelines, a banker told the paper.
“NPCI has prescribed that transactions can be authenticated by biometrics only when they get validated by UIDAI,” the banker said, adding that NPCI does not allow biometrics collected by devices as a mode of authentication.RBI’s data localisation rule, however, seems to be one of the major hurdles for most of the multinational companies including Mastercard, Visa, Amazon, WhatsApp and PayPal to launch a UPI-based payment platform in India.
Facebook-owned messaging app WhatsApp, as well as Amazon, are also keen on entering payments space in India through inter-bank fund transfer railroad UPI. They both, however, are waiting for more clarity on data storage from the Reserve Bank of India.
Even Google, which has similar plans, is said to be assessing the evolving situation around data localisation.
These companies may have to wait for the final decision on the draft Personal Data Protection Bill, which is being put out for consultations.
Apple did not reply to emailed queries sent by the paper.
In October last year, Apple’s senior vice-president for internet software and services Eddy Cue had told the paper that the company was looking to bring Apple Pay to the Indian market.
“It is great that all of these payment mechanisms are coming out in India because it empowers people to be able to pay. What Apple Pay does is make that process easy, integrated and safe. We absolutely want to bring Apple Pay to the market here,” Cue had said.Currently, Apple Pay is available in Australia, Canada, Mainland China, France, Hong Kong, Ireland, Italy, Japan, New Zealand, Russia, Singapore, Spain, Switzerland, the UK, the US, and Taiwan.