[Data Protection on UPI platforms] Supreme Court seeks response from Facebook, Google, WhatsApp, Amazon

The Supreme Court on Monday sought responses from Google, Facebook, Whatsapp and Amazon on a plea by Rajya Sabha MP Binoy Viswam seeking directions to ensure that data of Indian citizens collected on Unified Payments Interface (UPI) platforms is not misused by these corporations (Binoy Viswam v. RBI)..The petition filed before the top Court has sought directions to be issued to the Reserve Bank of India (RBI) to formulate regulations to ensure that this data collected by UPI platforms is not misused and the right to privacy of the citizens in this regard is not violated..When the matter came up for hearing on Monday, it was pointed out petitioner's counsel, Senior Advocate Kapil Sibal that Whatsapp, Facebook etc have not filed any formal response..The Court, therefore, issue formal notice to the corporations..The Court had earlier issued notice to Central government and Reserve Bank of India in the matter in October 2020..The petitioner has prayed that RBI and National Payments Corporation of India (NPCI) should ensure that the data collected by the entities like Google, Amazon and WhatsApp, for the purpose of facilitating payments is not shared with their parent companies or any other third parties..It is Viswam's argument while the RBI and NPCI are obligated to protect the data of Indian citizens, these bodies are, on the contrary, compromising the interests of the people "by allowing the non-compliant foreign entities to operate its payment service in India."Millions of Indians use UPI platforms for making payments and with the RBI and NPCI allowing the "Big Four Tech Giants" to participate in this UPI ecosystem without much scrutiny, sensitive financial data of the Indian citizens is at risk of being misused, the petition filed through advocate Sriram Parakkat states."This conduct of the RBI and the NPCI puts the sensitive financial data of Indian users at huge risks, especially when these entities have been continuously accused of abusing dominance, and compromising data, among other things," it has been submitted. .Meanwhile, the RBI informed the Supreme Court that responsibility to ensure that tech giants like Whatsapp, Google and Amazon comply with rules and regulations governing Unified Payments Interface (UPI) platforms, lies not with the RBI but with the National Payments Corporation of India (NPCI)..[Data Protection on UPI platforms] NPCI, not RBI responsible to ensure Amazon, Google, Whatsapp comply with UPI regulations: RBI to SC .In an affidavit filed before the Supreme Court in December 2020, the RBI said Third Party App Providers (TPAPs) are not given any sanction by the RBI under the Payment and Settlement Systems Act, 2007 (PSS Act)."They are not system providers as defined in Section 2(q) of the PSS Act, i.e. authorised payment system operators, and therefore they do not fall under the regulatory domain of RBI directly. On the other hand, NPCI is the system provider of UPI and, therefore, comes under the regulatory radar of RBI," the RBI said..RBI also said that while it is important that the requirement of storage of payment data only in India is met with expeditiously, it has to be ensured that "any regulatory measures do not disrupt the ongoing payment transactions under the existing payment and settlement systems of the country or adversely affect the interests of the general public.".The matter will now be heard after four weeks by which time all parties are expected to file their responses.

[Data Protection on UPI platforms] Supreme Court seeks response from Facebook, Google, WhatsApp, Amazon

Debayan Roy

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