Google Pay seems to have run into a compliance issue in India as they seem to be operating in the country without appropriate authorisation. As per the report in The Hindu the Delhi High Court has asked the RBI how Google's mobile app based payment app is able to operate currently.
A Bench of Chief Justice Rajendra Menon and Justice A.J. Bhambhani issued notice to the RBI and Google India on a petition seeking direction to the tech giant to immediately stop Google Pay services in India.
The issue was raised through a petition filed by a Abhijit Mishra who claims that Google Pay did not figure in the list of 'Payment System Operators.' This is a list authorised by RBI and it's necessary for all operators who engage in payment activity to be listed here.
“Google Pay, being an unregistered entity to the Payment and Settlement Systems Act 2007, is not in compliance with the requirements and the RBI’s Master Circular,” the petition said.
BI’s April 2018 Master Circular on Storage of Payment System Data mandates that all payment system providers need to store all their data for related to payments and systems operated by them in the Indian context in servers located within India.
The petition said Google Pay was using NPCI’s (National Payments Corporation of India) BHIM unified payments Interface (BHIM UPI) for money transfers.
UPI has record 800 million transactions in March 2019 and Google Pay helps is bringing a significant number of these transactions as it's very popular in the urban areas.
“Google Pay by the virtue of unauthorised access to the BHIM AADHAR – Unified Payments Platform can have serious detrimental effect on the privacy and personal liberty of Indian citizens as the data might be stored in servers located outside India,” it contended.
According to the petitioner Google India using Google Pay has unauthorised access to private information such as Aadhaar, PAN, transactions of Indian citizens using it's payment system. This access is currently unmonitored and unauthorised.
Google Pay is one of the best apps for using UPI with great features and cashbacks for users. It would be a pity if it was banned in order to create room for growth for local Indian apps.
I'm hopeful Google India won't be banned from providing Google Pay app to Indian users because of this compliance issue. Let's see where this goes.
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