RBI tokenisation deadline extended by 6 months till June 30, 2022

In a major development,  tokenisation deadline by RBI has been extended by 6 months. RBI in a statement said, "The timeline for storing of CoF data is extended by six months, i.e., till June 30, 2022."

In a notification - Restriction on storage of actual card data [i.e. Card-on-File (CoF)] - RBI said, "In light of various representations received in this regard, we advise as under: a) the timeline for storing of CoF data is extended by six months, i.e., till June 30, 2022; post this, such data shall be purged; and b) in addition to tokenisation, industry stakeholders may devise alternate mechanism(s) to handle any use case (including recurring e-mandates, EMI option, etc.) or posttransaction activity (including chargeback handling, dispute resolution, reward / loyalty
programme, etc.) that currently involves / requires storage of CoF data by entities other than card issuers and card networks."

Earlier, RBI had given a deadline of December 31 for tokenisation. This meant that from January 1, merchants will not be able to store card information of users and will have to replace each card number with a randomised token number. 

"In terms of our circular DPSS.CO.PD.No.1810/02.14.008/2019-20 dated March 17, 2020 on “Guidelines on Regulation of Payment Aggregators and Payment Gateways”, the authorised nonbank payment aggregators and merchants on-boarded by them were prohibited from storing card data (CoF) from June 30, 2021. At the request of industry stakeholders, this timeline was extended to December 31, 2021 vide circular CO.DPSS.POLC.No.S33/02-14-008/2020-2021 dated March 31, 2021. Further, regulations on CoF Tokenisation (CoFT) were issued vide circular CO.DPSS.POLC.No.S-516/02-14-003/2021-22 dated September 07, 2021 on “Tokenisation – Card Transactions: Permitting Card-on-File Tokenisation (CoFT) Services”"," RBI said in a statement.

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India has an estimated 98.5 crore cards, which are used for about 1.5 crore daily transactions worth Rs 4,000 crore, as per industry body CII. 

The value of the Indian digital payments industry in 2020-21, as per the RBI's annual report, was Rs 14,14,85,173 crore.