RBI directs payment operators to keep data within India

Mumbai: The Reserve Bank of India (RBI) on Thursday directed all payment system operators in India to store data within the country.

Alongside the announcement of the bi-monthly monetary policy statement, the RBI noted that in order to have unfettered access to all payment data for supervisory purposes, payment system operators have been asked to ensure that data related to payment systems operated by them are stored only inside the country.

Furthermore, payment system operators, the RBI said, will be given six months to make the necessary transition.

On the other hand, the central bank directed all regulated entities including banks not to provide services to businesses dealing in virtual currencies (VCs) like bitcoins, so as to protect consumer interest and check money laundering.

The same was announced by RBI Deputy Governor BP Kanungo in a press conference.

The RBI also asked entities which are already into such services to stop providing the same within three months.

The central bank has remained firm on its stance regarding virtual currencies.

The users, holders, and traders of VCs were cautioned three times, in December 2013, February and December 2017, by the RBI about potential financial, operational, legal, customer protection and security-related risks that they are exposing themselves to by investing in Bitcoin and/or other VCs.