Digital Payments mess: On the impact of recurring payments and tokenisation

I spoke with Suprita Anupam of Inc42 for a story he did on the impact of the Reserve Bank of India’s recurring payments and tokenisation on consumers and businesses. It’s a thoroughly researched article, and I highly recommend reading it.

My comments on the issue:

  • Recurring transactions, both Indian and global, fail often: “Both as a consumer and as a business user of global digital services, I’ve found that recurring transactions fail often. We’ve also had situations where some global services no longer accept Indian credit cards, post the RBI guidelines related to recurring payments, as well as the tokenisation guidelines. As a consumer, I have had to re-enter my credit card details and enable payments for a few Indian services as well, and that’s an inconvenience I wish I didn’t have to deal with.
  • Lack of a proper consultation process creates such issues: “The problem I have with the Reserve Bank of India is that they don’t appear to take into consideration the impact of their regressive regulations on merchants and consumers, and the increasing inconvenience this leads to. There was no impact assessment, no public consultation: just a diktat with a deadline, which eventually got pushed repeatedly because of lack of feasibility.
  • Why only credit cards? We also have to take into account that the RBI has enforced these guidelines on credit cards, which have better customer service, fraud detection and accountability, and yet they’ve failed to do anything to enforce accountability in case of UPI, especially in terms of fraud detection and prevention. There’s a saying “if it ain’t broke, don’t fix it.” In case of the RBI, they broke something that was working — credit card payments– and have failed to fix something that is crying out loud for regulatory intervention — UPI.”