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‘No payment services on WhatsApp without data localisation,’ RBI to SC

It appears that there is no end in sight to WhatsApp’s woes in India. The Reserve Bank of India, in its submission to the Supreme Court, said that it has directed National Payments Corporation of India (NPCI) to not allow full-scale launch of WhatsApp Pay on the Unified Payments Interface (UPI) as the platform does not comply with data localisation norms, the Economic Times reported.

This submission was made in a case that had been filed by Centre for Accountability and Systemic Change (CASC), to which RBI was made a party. CASC has alleged that WhatsApp launched its payment services in India without fully complying with RBI’s directives on data localisaiton, and without appointing a local grievance officer in India. WhatsApp Pay has been running in beta mode since February 2018, with the number of users capped at one million.

RBI had made its submission on November 6, and sent a letter to NPCI CEO Dilip Asbe on November 1, telling NPCI, to not allow WhatsApp Pay’s full-scale launch in India until it complies with data localisation norms. NPCI had developed the Unified Payments Interface (UPI) which WhatsApp intends to use for payments.

As the debate around data localisation, especially in finance sector, has raged, NPCI has supported WhatsApp Pay and Google Pay in India. In October 2019, the NPCI had said that WhatsApp Pay would be compliant with RBI’s guidelines within two months, the Business Standard reported. However, RBI had earlier told the SC that it did not give approval to entites like WhatsApp to act as authorised payment system operator; it is NPCI that has allowed that, the BS report continued.

A WhatsApp spokesperson told MediaNama that the company had nothing new to add. MediaNama has reached out to RBI and NPCI for comment.

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