The Merchant Payments Alliance of India (MPAI) and the Alliance of Digital India Foundation (ADIF) have urged the Reserve Bank of India to extend the December 31 deadline for card on file tokenisation.

While saying the norms are a step in the right direction, MPAI and ADIF in a letter to the RBI have noted that there are several operational challenges. The two bodies have sought a phased implementation of the new mandate, a minimum time frame of six months for merchants to comply post readiness of banks, card networks, and payment aggregators and payment gateways, as well as generating consumer awareness about the impact of the policy change.

“MPAI and ADIF are of the view that ‘ecosystem readiness’ is a sequential process of going live with stable API documentation for tokenised transactions,” they said in a statement issued on Wednesday.

Tiered timeline

They have also highlighted that the digital payments ecosystem is a long way from arriving at consumer-ready solutions and that the implementation of tiered timelines for compliance will help minimise disruption to consumer services. “Unless regulated entities are compliant, merchants will not be able to successfully process tokenised transactions,” they said.

Sijo Kuruvilla George, Executive Director, ADIF said that in the scenario that banks are lax on preparedness, the merchants will have to bear the brunt in the form of loss of revenue, anywhere between 20 per cent to 40 per cent.

Vishal Mehta, Chair of the Governing Council, MPAI said, “This unpreparedness will impact recent adopter of digital payments even deeply. The frequency and intensity of phishing attempts will go as entire card details are to be entered for each transaction, causing significant increase in irreversible fraudulent transactions.”