Reserve Bank of India: NASSCOM-MPAI representation on facilitating compliance with Card-on-File Tokenisation

Terms of use

Terms of Use

The use of this site and the content contained therein is governed by the Terms of Use. When you use this site you acknowledge that you have read the Terms of Use and that you accept and will be bound by the terms hereof and such terms as may be modified from time to time.

All text, graphics, audio, design and other works on the site are the copyrighted works of nasscom unless otherwise indicated. All rights reserved.
Content on the site is for personal use only and may be downloaded provided the material is kept intact and there is no violation of the copyrights, trademarks, and other proprietary rights. Any alteration of the material or use of the material contained in the site for any other purpose is a violation of the copyright of nasscom and / or its affiliates or associates or of its third-party information providers. This material cannot be copied, reproduced, republished, uploaded, posted, transmitted or distributed in any way for non-personal use without obtaining the prior permission from nasscom.
The nasscom Members login is for the reference of only registered nasscom Member Companies.
nasscom reserves the right to modify the terms of use of any service without any liability. nasscom reserves the right to take all measures necessary to prevent access to any service or termination of service if the terms of use are not complied with or are contravened or there is any violation of copyright, trademark or other proprietary right.
From time to time nasscom may supplement these terms of use with additional terms pertaining to specific content (additional terms). Such additional terms are hereby incorporated by reference into these Terms of Use.

Disclaimer

The Company information provided on the nasscom web site is as per data collected by companies. nasscom is not liable on the authenticity of such data.
nasscom has exercised due diligence in checking the correctness and authenticity of the information contained in the site, but nasscom or any of its affiliates or associates or employees shall not be in any way responsible for any loss or damage that may arise to any person from any inadvertent error in the information contained in this site. The information from or through this site is provided "as is" and all warranties express or implied of any kind, regarding any matter pertaining to any service or channel, including without limitation the implied warranties of merchantability, fitness for a particular purpose, and non-infringement are disclaimed. nasscom and its affiliates and associates shall not be liable, at any time, for any failure of performance, error, omission, interruption, deletion, defect, delay in operation or transmission, computer virus, communications line failure, theft or destruction or unauthorised access to, alteration of, or use of information contained on the site. No representations, warranties or guarantees whatsoever are made as to the accuracy, adequacy, reliability, completeness, suitability or applicability of the information to a particular situation.
nasscom or its affiliates or associates or its employees do not provide any judgments or warranty in respect of the authenticity or correctness of the content of other services or sites to which links are provided. A link to another service or site is not an endorsement of any products or services on such site or the site.
The content provided is for information purposes alone and does not substitute for specific advice whether investment, legal, taxation or otherwise. nasscom disclaims all liability for damages caused by use of content on the site.
All responsibility and liability for any damages caused by downloading of any data is disclaimed.
nasscom reserves the right to modify, suspend / cancel, or discontinue any or all sections, or service at any time without notice.

For any grievances under the Information Technology Act 2000, please get in touch with Grievance Officer, Mr. Anirban Mandal at data-query@nasscom.in.

New

See all

No notification found.

Reserve Bank of India: NASSCOM-MPAI representation on facilitating compliance with Card-on-File Tokenisation

Apurva Singh

@apurvaa

September 2, 2022

Public Policy

564

The Reserve Bank of India (RBI), on July 28^th, 2022, had announced a clarification on storing card-on-file (CoF) data for guest check-out transactions and other post-transaction activities. This came after extension granted by the RBI to purge stored card details in compliance with PA/PG Guidelines to September 30^th, 2022.

NASSCOM, along with the Merchant Payments Alliance of India (MPAI), made a joint submission to the Reserve Bank of India in continuation of discussions on card-on-file tokenisation (CoFT) and the challenges faced by the ecosystem therein. In the representation, we emphasised on the ecosystem readiness with CoFT to be viewed holistically from the end consumers’ perspective i.e., they should be able to successfully conduct payment transactions using tokenised card details for the ecosystem to be ‘ready’.

In the joint representation, we highlighted that:

Token provisioning: The success rate of mapping card details onto tokens upon receipt of tokenisation requests is in the range of 90-95 percent.
Ecosystem participants i.e., merchants which maintain their own payment infrastructure have ramped up the processing of tokenised transactions on their systems. However, merchants which rely on payment aggregators/gateways (PA/PGs) are yet to make any meaningful progress on the same.
Token processing (one-time payments): In terms of one-time processing of payments through pre-provisioned tokens, the success range is between 60-65 percent. Per our understanding, transactions typically fail due to optimisation issues at the PA/PG’s end. We were also informed that some merchants are yet to be given access even to beta versions of token flows developed by PA/PGs, and therefore, such merchants have not been able to begin any meaningful testing of token solution for their customers. For such merchants, migration of existing customers to new systems is yet to take place as well. They do not have visibility on tokens for recurring payments and guest checkouts either.
Recurring payments: We noted that processing solutions for recurring payments is even for challenging because of the following:

Mandate creation – Mandate creation using a combination of mandate ID and token, instead of mandate ID and card details;
Mandate migration – Conversion of existing e-mandates (based on card details) to mandates based on tokens; and,
Mandate renewal – Ensuring periodic auto-debits on the relevant account based on a combination of mandate ID and token.

In this regard, we noted that some merchants who are completely dependent on payment aggregators have not had any texting experience on the three aforementioned elements as on date of writing. Members that have been able to test still have only limited visibility on the efficacy of recurring payment flows due to lean upstream readiness. At the merchant’s end, access to bank identification numbers (BINs) from card networks is necessary to map mandate IDs and process recurring payments. Progress on this front is also limited.

Suggestions:

We made the following suggestions to the RBI in our representation:

the RBI mandates card networks and PA/PGs to share a status report to demonstrate their readiness to fulfil tokenized transactions across all use cases; and,
the RBI takes appropriate actions as deemed necessary to ensure that issues with token flows for recurring payments are duly addressed, before requiring the ecosystem to action the no-card storage rule.

For more information, kindly write to apurva@nasscom.in and mohit@koanadvisory.com.

Disclaimer

That the contents of third-party articles/blogs published here on the website, and the interpretation of all information in the article/blogs such as data, maps, numbers, opinions etc. displayed in the article/blogs and views or the opinions expressed within the content are solely of the author's; and do not reflect the opinions and beliefs of NASSCOM or its affiliates in any manner. NASSCOM does not take any liability w.r.t. content in any manner and will not be liable in any manner whatsoever for any kind of liability arising out of any act, error or omission. The contents of third-party article/blogs published, are provided solely as convenience; and the presence of these articles/blogs should not, under any circumstances, be considered as an endorsement of the contents by NASSCOM in any manner; and if you chose to access these articles/blogs , you do so at your own risk.

Apurva Singh

Senior Policy Associate

Write to me for all things related to FinTech, Drones, Data and Gaming