National – Visa (VN) has complained to the US government that informal and formal promotion of India’s domestic payments rival RuPay has hurt Visa’s business in a key market. Rupay card was promoted by Prime Minister Narendra Modi.
Payment gateway company Visa (VN) has complained to the US government that “informal and formal” promotions by India’s domestic payments rival RuPay have hurt Visa’s business in a key market. The Rupay card was promoted by the Prime Minister of India, Narendra Modi, in the spirit of use of indigenous products and national service.
Visa had not publicly expressed much concern about RuPay’s growing influence, but a US government memo shows that Visa had entered the U.S. on 9 August. Concerns were raised about “equal competition” in India during a meeting between company executives including Trade Representative (USTR) Catherine Tai and CEO Alfred Kelly.
MasterCard, along with Visa, has raised similar concerns privately with USTR. The company had lodged a protest with the USTR that Indian Prime Minister Modi was using nationalism to promote local networks. “Visa is concerned about India’s informal and formal policies, which appear to be in favor of the National Payments Corporation of India (NPCI), which operates the RuPay card,” the USTR memo said.
Prime Minister of India Narendra Modi has promoted RuPay card since its launch, which is also challenging Visa and MasterCard in the fast growing payments market. RuPay accounted for 63 per cent of India’s 952 million debit and credit cards as of November 2020, up from just 15 per cent in 2017, according to the company’s most recent regulatory data.
Visa also referred to the Prime Minister’s speech during the launch of the RuPay card at the USTR gathering on August 9, in which he requested to use the RuPay card as a service to the nation. Finance Minister Nirmala Sitharaman said last year that banks should promote RuPay cards. The government has also promoted RuPay-based cards for public transport payments.
