The Reserve Bank of India has restricted American Express and Diners Club from adding new customers in India from May 1.
RBI's decision came as it found that both companies were violating the data storage rules. As per RBI's directions on 'Storage of Payment System Data' the payment system providers in India were to ensure that their entire data related to their daily operations is being stored in a system in India itself.
Reacting to the development, American Express in a statement said: "We have been in regular dialogue with the Reserve Bank of India about data localisation requirements and have demonstrated our progress towards complying with the regulation."
RBI, American Express and Diners Club clarified that the order will not impact the existing credit card customers.