New RBI Guidelines Force You To Memorise All Of Your Card Details

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It’s time to get your brain prepped to do some much-needed homework and commit to memory the 16-digit numbers from all of your debit/credit cards! Why?

Because the Reserve Bank of India’s newly issued guidelines might not leave you with any other choice otherwise apart from physically carrying your cards everywhere you go or memorise each and every detail of your cards completely.

RBI – the apex banking institution of the country recently released a new set of rules which dictate that e-commerce portals, payment aggregators and online merchants will no longer be allowed to legally store card details of customers. This includes everyone from Amazon, Flipkart, GPay To PayTM, Netflix and more.

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These new guidelines will come into effect starting from July 2021 according to the circular floated by RBI. After the implementation of these rules, instead of simply entering the CVV in the ‘saved cards’ section, consumers will be required to enter all card details (name, card number, expiry date) from scratch every time they need to initiate a new online payment.

A Step Back For Digital India?

Now, one can easily argue that these newly released RBI guidelines will defer the country’s incessant push for ‘Digital India’ and opposes the motto of creating a ‘cashless India’. The central bank, however, thinks otherwise.

The Reserve Bank of India believes that these rules are meant purely for risk mitigation. Released last year, the RBI’s annual report for 2019-20 highlighted card and internet-related frauds, though constituted a minuscule per cent of the total number of recorded frauds, increased a whopping 174% to ₹195 crores in 2020 from ₹71 crores in 2019.

But, that being said, not everyone agrees with RBI and instead believe the move is indeed intended to act as a roadblock to the successful creation of Digital India.

In the month of January, NASSCOM aka the National Association of Software and Service Companies, in a letter to the central bank, expressed their concerns against a similar step. 

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It said such guidelines will render merchants unable to provide effective resolution of consumer complaints and speedy approval of refund requests. And, in turn, make them completely dependent on banks and payment processing aggregators to provide the same.

Thus, it proposed RBI could instead develop card data storing framework with all the important necessities such as security measures, reporting requirements and governance mechanisms integrated into it.

Flipkart, Amazon, Netflix: Hamper Consumer Payment Experience

Post RBI releasing the guidelines against card details storage, a group of 25 consumer-facing internet companies such as Flipkart, Amazon, Microsoft, Netflix and Zomato also wrote to the country’s central bank and argued against it.

They mentioned how it would negatively impact a customer’s online payment experience by a large extent and make merchants redundant when it comes to fraud risk assessment of their own.

All in all, regardless of all arguments related to the pros and cons of the implementation of these guidelines, it is definitely bound to make things more tedious for the end consumer. Thus, that is something that everyone needs to be collectively prepared for. We will keep you updated on all future developments. Until then, stay tuned.

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