Even as Google has agreed to comply with the Indian rules for payments operators on data localisation, it has pushed for free cross-border flow of data while expressing that it needs additional time to meet the Reserve Bank of India’s mandate for local storage of data. At a meeting between delegations led by Google CEO Sundar Pichai and Minister of Law & Justice and Electronics & IT Ravi Shankar Prasad in California last month, the search-engine giant’s team informed the Centre that it would meet all the norms with regard to its service Google Pay and at the same time sought extension to meet the local storage mandate.
“Pichai in his meeting with Prasad assured the minister that Google Pay will comply with all the regulations related to digital payment services in India. He, however, sought two months additional time to comply with the RBI notification,” a senior government official who was present at the meeting, said, asking not to be named. Google launched its UPI-based payments app Tez in September last year, and renamed it to Google Pay last month.
In April, the banking and payments regulator had directed payments system operators to store all data, including full end-to-end transaction details and information collected, within India to ensure security of users’ information. The operators have been asked to comply with instructions within six months, by October 15, 2018. The government, at the same time, has tightened its grasp on messaging app WhatsApp, which is planning to roll out its own UPI-based payments service. The Centre has asked WhatsApp to set up a local unit within India alongside having an India-based grievance officer and ensure compliance of Indian laws.
In response to a query seeking comments for this story, a Google spokesperson noted that the company maintained its stand on cross border data flows that are essential for global economic activity. “Soaring data flows generate more economic value and hence the socio-economic impact of restricting data flows must be thoroughly considered while framing any policy. There is a need to find practical and contemporary solutions to policy issues in line with global best practices. We have nothing to add at this point of time,” the spokesperson said. However, he did not respond to a specific query on whether Google has sought an extension in complying with the RBI’s localisation mandate.
More so, in a letter dated September 5, Pichai wrote to Prasad calling for free cross-border flow of data. “Free flow of data across borders — with a focus on user privacy and security — will encourage startups to innovate and expand globally and encourage global companies to contribute to India’s digital economy,” Pichai wrote. A February report by Credit Suisse pegged the then Google Tez to be the fifth-largest player in terms of monthly non-cash transactions clocked. As per the report Tez was recording nearly 80 million transactions a month, almost as much as Axis Bank.