RBI MPC Meet: Reserve Bank of India Deputy Governor T Rabi Shankar said on Wednesday, June 8 that the payments ecosystem in India is “overall ready” for the implementation of a token system for card-based transactions, including online transactions. reserve Bank of India The deputy governor’s remarks came a few weeks before the June 30 deadline, after which new tokenization criteria will be implemented.
“With weeks to go to meet Token Deadline, the progress has been satisfactory. With about 16 crore tokens already created, it will be approaching the deadline. Over the past several months our teams are in constant discussions with all stakeholders to ensure that the tokenization process is implemented smoothly,” said Rabi Shankar at a press conference after announcing the decision of the RBI MPC meeting on Wednesday. Told.
He added that as the payments ecosystem as a whole is ready for tokenization, there is no need to speculate on the extension of the timeline.
“I don’t think there is any need to speculate about whether the deadline will be extended or not. There are some collateral issues that have come to our attention, which we will adjust as we go. These are new issues which come to the fore every time you change the regime,” Rabi Shankar told reporters.
In December last year, the central bank extended the implementation date of card tokens from January 1, 2022 to July 1, 2022. The decision was taken following requests from industry stakeholders to allow expansion in the scheme. Industry bodies had asked the Reserve Bank of India to extend the deadline beyond December 31 citing various challenges in implementing the new rule, under which merchants will not be able to store credit card or debit card information of customers.
However, according to a latest report by Moneycontrol.com quoting multiple sources, “Banks are yet to make any representation with apex banking body Indian Banks Association (IBA) or RBI for another extension.”
Under the new rules, a card holder can obtain a token to the card by initiating a request on the app provided by the token requester. The token requester will forward the request to the card network, which, with the consent of the card issuer, will issue a token corresponding to the combination of the card, token requester and device.
Under the new rule, when you start buying an item with a merchant, the merchant will initiate the tokenization. It will ask for your consent to tokenize your card. Once you give consent, the merchant card will send a token request to the network. The card network will then create a token, which will act as a proxy for your 16-digit card number, and send it back to the merchant. The merchant will save this token for future transactions. You will also need to enter your CVV and OTP as before to approve the transaction. If you want to use another card, the same process will have to be followed again.
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