American Express to resume sharing card holders’ financial information with NeSL

Reason for move

“In compliance with the extant regulatory guidelines on submission of financial information to Information Utilities (IU), we wish to notify that we will commence reporting your card information to National E-Governance Services Limited (NeSL) effective November 2022 onwards,” American Express wrote in the email.

Card holders will receive an email notification from NeSL on a monthly basis to review and verify the information that American Express will submit on an ongoing basis and they will have to register at NeSL’s portal to authenticate or dispute the information within a stipulated timeline, according to the communication.

An email sent to American Express did not elicit an immediate response.

In the frequently asked question (FAQ) section on its website, American Express has mentioned that as per the Reserve Bank of India’s (RBI) December 2017 regulation, it is mandatory for all banks to report financial information of card holders to NeSL.

RBI regulation

RBI’s December 19, 2017 regulation says, “A financial creditor shall submit financial information and information relating to assets in relation to which any security interest has been created, to an information utility (IU) in such form and manner as may be specified by regulations.”

NeSL was registered as the first IU by the Insolvency and Bankruptcy Board of India (IBBI) on September 25, 2017. The primary role of NeSL is to serve as a repository of legal evidence holding information pertaining to any debt/claim, as submitted by the financial or operational creditor and verified and authenticated by parties to the debt.

American Express, in the FAQ, said it will only be reporting existing debt information as available in its systems of records to NeSL in order to be in compliance with the regulatory requirement and was not seeking any additional information from card holders.

Moreover, American Express card holders said they were never informed about this regulation when the credit card was initially issued to them.

Legal experts believe that sharing personal financial information related to card holders spending with any entity, including a government-registered one, is a breach of their privacy.

Customers have now become more cautious on how their data is being used and are wary of sharing their sensitive personal information to any entity.