Mobile payment is still a big challenge in India. Indian mobile payment is facing problems on the fronts of legal framework and cyber security. Although the Reserve Bank of India (RBI) has announced that it may introduce encrypted SMS based fund transfers in India yet this move has many practical and techno legal difficulties to be resolved. Similarly, issues of privacy, data protection (PDF), cloud computing, biometrics data collection laws, etc are still unresolved and may create legal problems for mobile payment vendors in India.
Medianama has reported that Apple may be considering an expanded mobile payments strategy for its capacitive fingerprint sensor Touch ID. The same was introduced last September as a feature on the iPhone 5s. The sensor currently allows users to scan their fingerprints to authenticate purchases from iTunes store, App Store and iBooks Store among others. Apple has been working in the direction of ensuring an expanded mobile payment service which includes facilitating payments of physical goods and services from its devices.
Earlier this month, Apple had also filed a patent for a touchless e-wallet, wherein it had detailed a method to establish a wireless and secure connection between a purchasing device to a point of sale device and then connecting to the back end to conduct a secure commercial transaction.
This project of Apple seems to be promising in foreign jurisdictions but the same would face many techno legal problems in India due to regulatory complications. Some of the features and activities of Apple’s proposed project may violate the laws of India if proper precautions are not undertaken well in advance.
However, till now it is unclear whether Apple would launch this product in India or not. RBI is already struggling with technological issues and virtual currencies like Bitcoins. Many Bitcoin exchanges of India are already under regulatory scanner and more may be covered in the near future. Apple uses a global payment gateway on which RBI has no jurisdiction and RBI may find it difficult to regulate. Further, Indian law insists on dual authentication and Apple’s product may not qualify this condition. Let us wait for the future developments in this regard in India.