The Delhi high court, on Monday (August 24), issued notice to the Union government and the Reserve Bank of India (RBI) in a plea case against Google Pay over allegedly violating guidelines related to data localisation, storage and sharing norms.
The plea filed by advocate Abhishek Sharma sought directions to Google India Digital Service, which operated Google Pay, to give an undertaking that it does not store data on the Google Pay servers under the UPI ecosystem. The plea also seeks a bar on Google Pay’s data sharing with any third party company, including its holding or parent company. Issuing the notices to the central government and the RBI, the bench of Chief Justice D N Patel and Justice Prateek Jalan listed the matter for further hearing on September 24, according to a report in ET.
The plea alleged that Google Pay was also violating UPI procedural guidelines by sharing sensitive personal user data in breach of regulatory guidelines. It also sought to direct the RBI to take action and impose a penalty on Google for its alleged violations of the applicable data localisation laws for financial services providers and payment apps.
Sharma also wants the RBI to take punitive action against the National Payments Corporation of India (NPCI) and revoke its authorisation to operate and regulate UPI payments, on account of risking customer payments data and its failure to audit and penalise Google India Service.
Gpay, which was earlier called Google Tez was launched in September 2017 and the name was changed to Google Pay in August 2018.
The fresh petition comes in the backdrop of a series of legal woes faced by Google Pay. In April, 2019, the Delhi high court had questioned the RBI about the legality of Google’s payment app.
Responding to the high court’s question, a Google spokesperson had told Inc42 earlier that “Google Pay operates as a technology service provider to its partner banks, to allow for payments through the UPI infrastructure, and is not part of payment processing or settlement. There is no requirement for licensing of these services under the prevailing statutory and regulatory provisions.”