Mumbai: Keeping in mind the repeated requests from industry stakeholders, the Reserve Bank of India (RBI) on Thursday extended the deadline for cards tokenisation till June 30, 2022. For the unversed, the card tokenisation means replacement of credit and debit cards details with an alternate code called as “token”.
In the fresh order, the RBI said the timeline for storing of card on file (CoF) data is extended by six months till June 30, 2022. In the order which has been issued to all payment system operators, the RBI said after the expiry of the extended deadline, all such data will be purged. As per updates, the earlier deadline set by the RBI was to expire on December 31, 2021.
“In addition to tokenisation, industry stakeholders may devise alternate mechanism(s) to handle any use case (including recurring e-mandates, EMI option, etc.) or posttransaction activity (including chargeback handling, dispute resolution, reward / loyalty programme, etc.) that currently involves / requires storage of CoF data by entities other than card issuers and card networks,” RBI added in a statement.
After June 30, 2022, the merchants will not be able to store card information of users and will have to replace each card number with a randomised token number.
Earlier, the Indian Banks Association (IBA) had sent a request to the RBI for an extension of the tokenisation deadline.
It must be noted that the tokenised cards are considered safe for online transactions as the details of these cards are not shared with the merchant during transaction processing.
The development comes as the merchants had sought at least six more months to implement new card data storage norms saying any quick decision in enforcement may cause major disruptions, erode trust in digital payments and loss of revenue.
The Merchant Payments Alliance of India (MPAI) and the Alliance of Digital India Foundation (ADIF) had sought phase wise implementation of new norms, and said merchants should get a minimum six months to comply with post readiness of banks, card networks, and payment aggregators/ payment gateways.
Notably, India has an estimated 985 million cards, which are used for about 15 million daily transactions worth Rs 4,000 crore.
