RBI SHUTS OVERSEAS PAYMENT GATEWAY FOR CREDIT CARD TRANSACTIONS WITHIN INDIA

KOLKATA/BANGALORE: The Reserve Bank of India moved to close a loophole on Friday, saying that the rules need to be followed with respect to e-commerce credit card transactions “essentially taking place between two residents in India”. This means that companies such as Uber will need to follow the two-step authentication process that it was able to circumvent by virtue of having an overseas payment gateway. Its rivals welcomed the move. The central bank told banks to ensure that payments should be in rupees in instances when the credit card is not presented physically. “It was clarified that the mandate shall apply to all transactions using cards issued in India for payments on merchant sites where no outflow of foreign exchange is contem