At RBI’s door for reprieve: Bunch of foreign banks want ease of storing data, ask for mandate to be applied prospectively from Jan 2025
foreign banks that operate in the country have approached the Reserve Bank of India (RBI) seeking prospective application of the guidelines on mandatory local storage of payments data from January 2025 with regard to information that’s already kept overseas. They have also sought a reprieve from any regulatory action until then.
These guidelines, issued in 2018, mandate that all payment system data related to customers in the country must be stored solely in India.
“Some foreign lenders have pressed for a prospective compliance date starting January 2025 to ensure all lenders can meet the regulations,” a senior foreign bank executive said, confirming a meeting with RBI officials on the data localisation issue.
Foreign banks have started complying with the guidelines for fresh transactions but have expressed difficulty in shifting those that took place in the past and stored overseas. They raised the issue at a meeting of the Indian Banks’ Association (IBA), seeking intervention with the RBI over the matter.
“Banks, internally, have been making efforts but not all such data has been deleted from foreign servers, and that can lead to regulatory action,” said another senior executive at a different foreign bank.
‘Limited Extraction Difficult'
The RBI did not respond to queries.
In 2021, following a representation by the IBA, the RBI allowed foreign banks operating via branches to keep some limited data abroad. In their latest representation, foreign banks said deleting just the Indian payment data is
