Ban On Mastercard To Impact Banks' Income, Card Operations: Report

RBI's order followed similar action in April against American Express, but Mastercard is a much bigger player in the Indian market, where many lenders offer cards using the U.S. firm's payments network.

India's decision to ban Mastercard Inc for non-compliance with data storage rules has unsettled the country's financial sector as it will disrupt banks' card offerings and hit revenues, payments and banking industry executives told Reuters. Wednesday's central bank order followed similar action in April against American Express, but Mastercard is a much bigger player in the Indian market, where many lenders offer cards using the U.S. firm's payments network. A Reuters analysis of online card listings of 11 domestic and foreign banks in India showed Mastercard accounted for about a third of roughly 100 debit cards on offer, and more than 75 credit card variants used its network. From July 22, the Reserve Bank of India (RBI) said, new issuance of such cards will stop as Mastercard did not comply with 2018 rules requiring foreign card networks to store Indian payments data locally for "unfettered supervisory access".