Reuters has accessed a document, which was submitted by Payment networking giant Mastercard to its US based authorities in June. In the document, it is alleged that Prime Minister Narendra Modi is using Nationalist sentiments to promote indigenous payment networks such as RuPay, which is creating issues for American digital payment companies.
In a written reference to Modi’s stance, Mastercard told the Office of the United States Trade Representative (USTR) on June 21 that the Prime Minister “associated the use of RuPay cards with nationalism, claiming it serves as ‘kind of national service’.”
Since 2016, Prime Minister Narendra Modi is strongly encouraging people to use cashless modes of transaction such as credit card, debit card, online payment through apps etc. At the same time, he has been encouraging people to use Indian payment networks such as BHIM app and RuPay card for the purpose, so that the transaction fees remains with the Nation, which could be later used for country’s overall development.
As a result of Prime Minister’s open endorsement, now more than a half of India’s 1 billion debit card holders use RuPay as the payment service, which has become a major cause of worry for foreign companies such as Mastercard and Visa.
The note which was sent by a Mastercard Vice President for Global Public Policy, Sahra English to US authorities clearly states that Prime Minister Narendra Modi’s open endorsement of RuPay and other indigenous systems is creating issues for them.
“Increasing rhetoric from the prime minister and government mandates on promotion and preference for RuPay … continues to create market access issues for U.S. payments technology companies,” Mastercard said in the note.
In the note, the payment giants further proposes to the US authorities that Indian Government’s preferential treatment of RuPay must be discontinued. “The Indian government’s preferential treatment of RuPay coupled with fallacies on pricing must be discontinued,” it says.
However when contacted by Reuters, Mastercard said in a statement it “fully supports” the Indian government’s initiatives and is “deeply invested” in the country. The company did not comment on its USTR note and its executive Sahra English did not respond to questions.
For long, US based companies in India have been accusing Prime Minister Narendra Modi’s government of implementing protectionist policies. Earlier this year, the US technology companies had also protested against an Indian law that would require them to store more data locally, raising their costs.