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    Question

    Why did the Reserve Bank of India (RBI) direct Visa and

    Mastercard to halt card-based commercial transactions?
    A Violation of environmental regulations Correct Answer Incorrect Answer
    B Non-compliance with COVID-19 guidelines Correct Answer Incorrect Answer
    C Concerns regarding Know Your Customer (KYC) regulations Correct Answer Incorrect Answer
    D Security breaches in the payment systems Correct Answer Incorrect Answer
    E Lack of innovation in financial technology Correct Answer Incorrect Answer

    Solution

    •     The Reserve Bank has directed Visa and Mastercard, two major players in international payments, to halt card-based commercial transactions made by small and large businesses. •     This action stems from concerns regarding compliance with Know Your Customer (KYC) regulations. •     Visa has confirmed receipt of communication from the regulator on February 8, while awaiting a response from Mastercard. •     This move follows the RBI's recent regulatory measures against Paytm Payments Bank. •     Some fintechs have also received the RBI direction to pause business payments made by commercial cards until further notice. Learn Along About RBI Founded: 1 April 1935                                          Headquarters: Mumbai                      Governor: Shaktikanta Das

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