Reserve Bank of India informed on Tuesday that it would be lifting the restriction imposed on the charge card company, Diners Club from issuing new credit cards. The apex bank informed that the decision was in light of satisfactory compliance by the charge card company. Back in April, RBI had barred the company from onboarding new domestic customers from May 1 on account of failure to comply with data localisation norms.
Other than Diners International, Mastercard and American Express too were barred from onboarding new customers for the same reason.
"In view of the satisfactory compliance demonstrated by Diners Club International Ltd. with the Reserve Bank of India (RBI) circular dated April 6, 2018, on Storage of Payment System Data, the restrictions imposed, vide order dated April 23, 2021, on on-boarding of fresh domestic customers have been lifted with immediate effect," the RBI circular stated.
RBI's data localisation norms stipulate that entire data relating to payments operated by the companies must be stored in a system only in India. Additionally, the data must be protected with end-to-end encryption. The companies had argued back in 2018 that creating such a digital infrastructure would be cumbersome and expensive.
The country was left with only two players - Visa and the indigenous, RuPay.
Private lenders Yes Bank and RBL Bank had announced this year that they would start reissuing credit cards with Visa following the Mastercard ban.