Data localization: Local adaptation may not guarantee data security: Mastercard Ajay Banga

MUMBAI: Storage of transaction data locally in India is costly and ineffective in terms of security and the overlapping of knowledge across markets, Globalcard said.

In April, India's central bank said payment companies had to store payment data locally since October to better track information. Foreign companies are seeking to relax the rule so they can store data both locally and offshore.

"When we talk about the lack of support for data tracking, it is not caused by costs, it is caused by the inefficiency of what security, security, and analytical data can provide to Indian banks and traders," said Jay Bakas , President and Chief Executive Officer of Mastercard. Secondly, if you locate, you are not able to learn from a country's knowledge and apply it to global platforms like ours in every country and … to use learning costs by 1/200 – that is to learn in one country and is available in 200. What India does is really allow both of these benefits to India to shut down. "

The company started data storage locally, he said during the discussion with investors. Regarding how data is stored locally, Banga said: "Managing this data tracking is a matter of trying to place a set of servers to keep their data at the local level."

With the Indian Bank's push to locate data from the payments industry, global financial services companies, especially those from the US, have been pushing the government to seek to relax the rule. Last week, Visa, the world's second largest payment card company, said it is working towards implementing a solution to comply with RBI requirements and began storing data locally from October 15 to ease the demand of the RBI for access to payment data.

"We have detailed information on the state of play and action plan in the RBI, including how we are going to remodel existing global processing systems to fully comply with data-only requirements in India," said Visa CEO Alfred F Kelly Jr quarterly earnings of the company invite the analysts. "Our technology teams are working virtually around the clock to complete our solution with little impact on our customers and our cardholders."

Over the past two years, the government has implemented several measures to encourage dealers and consumers to make digital payments, including final PoS fees and no tax on POS imports, which helped companies such as Mastercard and Visa increase by 20 -30% India after the poll in November 2016.

The RBI Circular also covers companies such as Paytm, WhatsApp and Google that offer electronic or digital payment services. At present, most of the data is stored in clouds outside of India.

In India, Mastercard, Visa and American Express continue to dominate payments, with a share of 70%, while R 94,100 crore transactions took place below June this year, according to RBI data.