E-commerce and food delivery are expected to suffer as a result of the RBI's order that companies not save customer card details.

According to industry sources and bankers, the Reserve Bank of India's plans to move toward card tokenization will affect a wide range of businesses, including large e-commerce enterprises, food delivery providers, and lenders, while increasing the use of cash.
To improve data security, the RBI released rules in March 2020 stating that retailers will not be allowed to keep card information on their websites. In September 2021, it published new instructions, giving businesses till the end of the year to comply with the rules and allowing them to tokenize.
Tokenisation is a data security technique in which card details are replaced by a unique code or token created by an algorithm, allowing online purchases to be completed without disclosing card details.

From January 1, 2022, the Reserve Bank of India has mandated that all enterprises in India erase saved credit and debit card data from their systems.
Merchants and lenders believe that they were not given enough time to comply with the changes, and that opting out of tokenisation would require a consumer to manually punch in their card details every time they made an online transaction, which may turn off some customers.
"Introducing an additional step in payments adds friction, and several studies show that customers may drop out in the case of a discretionary purchase," said Sijo Kuruvilla George, the director of the Alliance of Digital India Foundation, a think tank based in New Delhi that represents Indian startups.
"We estimate merchant revenue losses of roughly 20-40 percent, with smaller businesses suffering the most," he added.

Meanwhile, senior executives at state-owned banks and commercial lenders have expressed concern that the change could result in a significant drop in card transactions and an increase in cash payments in the short term, negating years of work by lenders and the government to promote digitalisation.
"Not all banks will be ready by January, and even if they are, consumers may choose for one-step cash on delivery rather than keying in details to prevent bother," said a banker with a major Indian lender who asked not to be identified because he is not authorised to speak to the media.
"As a result, not only will card transactions fall, but cash in circulation will increase as well, which is a source of concern."

In October, credit card transactions in India surpassed Rs. 1,00,000 crore, while other forms of digital payment have experienced a significant increase over the years.
According to an executive at an internet firm who asked not to be identified because the information is not public, the industry is still waiting for clarity on how cash back schemes and monthly-installment type card purchases would function, and has urged the central bank for additional clarity and time.
"The RBI is expecting the entire industry to come on board with tokenization, conduct testing, and move forward in less than four months," the executive noted.

An email to the RBI seeking comment on the subject was not immediately returned. Amazon, Walmart's Flipkart, and Zomato, an Indian food delivery service, did not respond to a request for comment.
Even if some card networks, banks, and merchants are ready, industry leaders estimate that it will take months to ensure that the operations are completely linked and seamless across the entire system.
"It could take another six to nine months for the entire ecosystem to be fully ready," PayU's Manas Mishra said.