Letters: Card payment conundrum

The editorial "Lighter touch" (August 25) takes a principled position for simplifying card payments by the Reserve Bank of India (RBI), even if it requires tweaking the existing regulations. As the Uber case reveals, there may be a case for relaxing norms for card payments up to some small value - say, Rs 1,000 a day by deleting second authentication. This will hopefully facilitate the growth of other small-value card payments and more such businesses in the country. However, people feel uncomfortable in sharing the card verification value or CVV number with companies on a regular basis, which could create difficulties for the cardholders in case a company goes rogue.

It is preferable if the companies that are looking to set up grass-roots types of businesses such as taxi services for Indians have some physical presence in the country. More importantly, the Uber model of taking away payments outside India and then routing these back to the drivers' accounts may be more problematic for RBI since it exposes the chinks in its classification of forex transactions, with these payments falling under its capital account category. Overall, the Uber model presents a case of disruptive technology with the potential to change the way we normally undertake some types of card payments.

Y P Issar Karnal

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