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RBI denied WhatsApp to go live with Unified Payment Interface
The Reserve Bank of India has informed the Supreme Court of India that it has denied WhatsApp to go live with the Unified Payment Interface (UPI) fee system. RBI filed an affidavit in Supreme Court and held that the payment gateway is still under inspection and shall not be allowed until all the required agreements are cleared.
The central bank in its counter proclamation said – Reserve Bank has examined the reports and the responses of the National Payment Corporation of India (NPCI) and was anxious that WhatsApp was storing payment data outside India Permitted timelines indicated in the circular and The Frequently Asked Questions (FAQs) of payment system issued by Reserve Bank of India on June 26th, 2019.
The RBI acknowledged that the NPCI had communicated to it the System Audit Report and the Post Change Review Report sent to it by WhatsApp, which touched upon the details concerning the storage of payment system data. As per Reserve Bank of India had advised the National Payment Corporation of India to ensure that the payment data element is not stored outside India permitted timelines. NPCI was also asked to ensure that WhatsApp does not store any payment transaction data element in hashed or de-identified or encrypted form in its system which is outside India. NPCI was supposed to advise the WhatsApp to no go live until they get clearance from RBI.
The petition contained that WhatsApp is a foreign company with no head payments office in India and to run the UPI fee system in India WhatsApp should have a separate office in India to store all the information of Indian banks in India itself. The NPCI had, through RBI’s letter dated January 7, said that they had received a letter from WhatsApp agreeing to complete all the pending issues by May 31, and requesting permission to go live. The NPCI had then requested RBI’s approval to grant the final ‘go-live’ to WhatsApp on UPI, subject “to the third-party audit report confirming closure of the committed 2 items, and acceptable VA/configuration reports from the third-party auditor.
Further NPCI will have to adopt the limitations laid down while according permission to WhatsApp to be part of UPI. NPCI was also advised by RBI to ensure conformism to all other requirements governing the system.
The RBI’s response got here on a software filed by the Centre for Accountability and Systemic Change, through advocate Virag Gupta, in search of an entire stoppage of the trials being performed by WhatsApp Pay, claiming that the company has continued the final round of testing on its fund's system on 1 million customers in violation of knowledge localization norms in India.
CONCLUSION-
WhatsApp is trying to launch WhatsApp Pay in India since 2018 but due to some rules and regulatory system of the Reserve Bank of India, they are not able to launch it till now. Though India is the largest market of WhatsApp with more than four hundred million users and also it was set to have the first country to have the WhatsApp Payments. With the launch of WhatsApp Payments, it will be competing against players like Paytm, PhonePe, Google Pay, etc.
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