MasterCard Warns India’s Data Storage Law Could Impact Online Payments, Security
From October 16, theReserve Bank of Indiahas mandated all companies facilitating financial transactions to store user data in India. As a result, credit giant MasterCard will bedeleting the data related to Indian users from its data centers that are located outsidethe country.
MasterCard has already starting to store all transaction-related data of Indian users at its data center in Pune. Following RBI’s directives, the company will start deleting all data including users’ card number and transaction details.
A Threat to Security
MasterCard said that out of the 200 countries where it operates, none has asked it to delete data from its global servers. It has also informed the RBI about the potential demerits of this localization.
Deleting data from global servers andconcentrating all the information in a centralized database would weakenthe “security of this data over a period of time“.
MasterCard Waiting for RBI’s Response
The date for this deletion of data from global servers is yet to be decided. MasterCard has proposed a date to the RBI and iswaiting for a confirmationfrom the central bank. The creditor has initiated the process of copying the data and will start deleting the data once RBI acknowledges and responds to the request.
Since the deletion of data is not like “pressing a button“, it isnot a simple process and requires proper scrutinyat multiple checkpoints. In the process of deletion of data, users might be charged again for a past transaction, and thus, it has to be taken about carefully.
Higher Operational Cost
MasterCard has also informedPress Trust of Indiathat with the localization of data, there will be an “incremental cost“. This is because any data that has to be sent internationally will be processed in India first and stored indigenously.
Not only does this increase operational costs, but can alsoresult in delayed or failed transactionsif the recipient country’s data protection or privacy laws are not strong enough.
Beebom Contributor
Add new comment
Name
Email ID
Δ
01
