The plea sought direction from the top court to the RBI and the NPCI to ensure that WhatsApp is not permitted to launch full-scale operations of "WhatsApp Pay" in India
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The Supreme Court on Thursday sought response from Facebook, WhatsApp, Google, Amazon and the Centre on a plea filed by CPI MP Binoy Viswam seeking protection of data of transactions made over UPIs. The plea said that instead of fulfilling their statutory obligations, the RBI and the National Payments Corporation of India (NPCI) are compromising the interests of Indian users by allowing non-compliant foreign entities to operate its payment services in India. A bench headed by Chief Justice S.A. Bobde issued notices on the plea.
Senior advocate Mukul Rohatgi, representing Facebook, submitted that there are already two petitions pending before the top court in connection with WhatsApp's payment service. Senior advocate Kapil Sibal, representing WhatsApp, said that WhatsApp had previously submitted that payment services will not be rolled out before complying with the requirements. "There is apprehension that the regime of payments will commence before the regulatory framework is put in place," noted the top court, citing that the concerns raised in this petition are different.
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Senior advocate Shyam Divan, representing Viswam, submitted before the bench that the RBI in April 2018 had issued an order asking these foreign entities to ensure data transacted on their platforms are secured in a server within India. Divan added that this direction was supposed to be complied by October 2018, but it was not done. "The RBI and the NPCI have permitted the three members of the Big Four tech giants, i.e., Amazon, Google and Facebook/WhatsApp (Beta Phase), to participate in the UPI ecosystem without much scrutiny and inspite of blatant violations of UPI guidelines and RBI regulations," said the plea.
Divan argued before the bench that WhatsApp stores data with its parent company Facebook, which have serves located outside India. After a detailed hearing in the matter, the top court also issued notices to the RBI and the NPCI.
The plea sought direction from the top court to the RBI and the NPCI to ensure that WhatsApp is not permitted to launch full-scale operations of "WhatsApp Pay" in India, without fulfilling all legal compliances to the satisfaction of the court regarding the requisite regulatory compliances.
Viswam said WhatsApp has a grey history of compromised data and security breaches, which does not make it a viable option for running payment services.
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