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Q87 (IAS/2019) Economy › Economy Current Affairs › Digital payments ecosystem Official Key

Consider the following statements : The Reserve Bank of India's recent directives relating to 'Storage of Payment System Data', popularly known as data diktat, command the payment system providers that 1. they shall ensure that entire data relating to payment systems operated by them are stored in a system only in India 2. they shall ensure that the systems are owned and operated by public sector enterprises 3. they shall submit the consolidated system audit report to the Comptroller and Auditor General of India by the end of the calendar year Which of the statements given above is/are correct?

Result
Your answer: —  ·  Correct: A
Explanation

The correct answer is option A (Statement 1 only).

The Reserve Bank of India's directives relating to 'Storage of Payment System Data', popularly known as data diktat, command that payment system providers shall ensure that entire data relating to payment systems operated by them are stored in a system only in India.[2] All system providers were required to ensure that, within a period of six months, the entire data relating to payment systems operated by them is stored in a system only in India.[3] This makes Statement 1 correct.

Statement 2 is incorrect as the RBI directive does not mandate that payment systems must be owned and operated by public sector enterprises. In terms of Section 4 of the PSS Act, no person other than RBI can commence or operate a payment system in India unless authorised by RBI[4], but this authorization is not restricted to public sector enterprises only.

Statement 3 is also incorrect as there is no requirement in the RBI's data storage directive for payment system providers to submit consolidated system audit reports to the Comptroller and Auditor General of India. The directive primarily focuses on data localization requirements.

Sources
  1. [1] Indian Economy, Nitin Singhania .(ed 2nd 2021-22) > Chapter 8: Financial Market > 2020 > p. 247
  2. [2] Indian Economy, Nitin Singhania .(ed 2nd 2021-22) > Chapter 8: Financial Market > 2020 > p. 247
  3. [3] https://www.rbi.org.in/commonman/english/scripts/FAQs.aspx?Id=2995
  4. [4] Indian Economy, Vivek Singh (7th ed. 2023-24) > Chapter 2: Money and Banking- Part I > 10.Oversight of payment and settlement systems > p. 70
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Don’t just practise – reverse-engineer the question. This panel shows where this PYQ came from (books / web), how the examiner broke it into hidden statements, and which nearby micro-concepts you were supposed to learn from it. Treat it like an autopsy of the question: what might have triggered it, which exact lines in the book matter, and what linked ideas you should carry forward to future questions.
Q. Consider the following statements : The Reserve Bank of India's recent directives relating to 'Storage of Payment System Data', popularl…
At a glance
Origin: Books + Current Affairs Fairness: Moderate fairness Books / CA: 6.7/10 · 3.3/10
You're seeing a guest preview. The Verdict and first statement analysis are open. Login with Google to unlock all tabs.

This question is a classic 'Current Affairs headline meets Static Logic' test. While Statement 1 requires knowing the news (Data Localisation), Statements 2 and 3 are 'extreme exaggerations' designed to be eliminated by understanding the basic definitions of a Mixed Economy and the Constitutional role of the CAG.

How this question is built

This question can be broken into the following sub-statements. Tap a statement sentence to jump into its detailed analysis.

Statement 1
Reserve Bank of India "Storage of Payment System Data" (data diktat) directive: does it require payment system providers to store the entire data relating to payment systems they operate only in India?
Origin: Direct from books Fairness: Straightforward Book-answerable
From standard books
Indian Economy, Nitin Singhania .(ed 2nd 2021-22) > Chapter 8: Financial Market > 2020 > p. 247
Presence: 5/5
“What was the purpose of Inter-Creditor Agreement signed by Indian Banks and Financial Institutions recently? • (a) To lessen the Government of India's perennial burden of fiscal deficit and current account deficit. • (b) To support the infrastructure projects of Central and State Governments. • (c) To act as independent regulator in case of applications for loans of \overline{50} crore or more The Reserve Bank of India's recent directives relating to 'Storage of Payment System Data', popularly known as data diktat, command the payment system providers that: • They shall ensure that entire data relating to payment systems operated by them are stored in a system only in India. • They shall endure that the systems are owned and operated by Public Sector Enterprises. • They shall submit the consolidated system audit report to the Comptroller and Auditor General of India by the end of the calendar year.”
Why this source?
  • Explicitly commands payment system providers to ensure entire data relating to payment systems operated by them are stored in a system only in India.
  • Uses the phrase 'entire data' and 'only in India', which matches the statement's wording directly.
  • Labels the directive as 'Storage of Payment System Data' (data diktat), linking the requirement to that directive.
Indian Economy, Vivek Singh (7th ed. 2023-24) > Chapter 2: Money and Banking- Part I > 10.Oversight of payment and settlement systems > p. 70
Presence: 3/5
“The central bank of any country is usually the driving force in the development of national payment systems. The Reserve Bank of India (RBI) as the central bank of India has been playing this developmental role and has taken several initiatives for Safe, Secure, Sound, Efficient, Accessible and Authorised payment systems in the country. In India, the payment and settlement systems are regulated by the Payment and Settlement Systems Act, 2007 (PSS Act). In terms of Section 4 of the PSS Act, no person other than RBI can commence or operate a payment system in India unless authorised by RBI.”
Why this source?
  • Confirms RBI is the regulator for payment and settlement systems under the Payment and Settlement Systems Act.
  • Section 4 vests RBI with exclusive authority over who can commence or operate payment systems, supporting RBI's power to issue such storage directives.
Statement analysis

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Statement analysis

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