Apple has halted plans to bring digital payments to India, thanks in part to regulatory hurdles and challenges in creating a service that works with the UPI platform in the country.
According to The Economic Times, which cited two people with knowledge of the matter, Apple halted development of the digital payment service even though it had held talks with some of the leading banks in India as well as the National Payments Corporation of India, which manages the UPI platform. The report noted Apple’s biggest concern is a new data location rule put in place by the Reserve Bank of India. It is requiring companies to store payments locally within the country. Facebook and Google, who already offer digital payment services in India, have until October to start storing data in India.
Meanwhile, an unnamed banker told The Economic Times that Apple was interested in including fingerprints as a way of authentication for UPI payments, but the National Payments Corporation of India didn’t provide its approval for the idea. As it stands, UPI requires a six or four-digit code to authenticate payments, noted the report. “NPCI has prescribed that transactions can be authenticated by biometrics only when they get validated by UIDAI,” said the banker. “NPCI does not allow biometrics collected by devices as a mode of authentication.” For now, Apple is watching the regulatory landscape in India before entering the market.
In October Eddy Cue, the company’s senior vice president for Internet Software and Services, told The Economic Times Apple wants to launch Apple Pay in India but lacks the payment mechanism. “If you think about [it] in U.S. terms, we don’t care if it’s Mastercard, Visa or whatever or whatever bank you deal with. If you are in China, we don’t care if it’s [by] WeChat Pay or Alipay or credit card. It is great that all of these payment mechanisms [are] coming out in India because it empowers people to be able to pay,” said Eddy Cue when asked about the payments market in India. “What Apple Pay does is make that process easy, integrated and safe. We absolutely want to bring Apple Pay to India.”