NGO Urges Supreme Court to Stop WhatsApp Pay Trials in India

Centre for Accountability and Systemic Change (CASC) told the apex court that WhatsApp is still not following the data localisation norms.

NGO Urges Supreme Court to Stop WhatsApp Pay Trials in India

The NGO said that Indian WhatsApp users cannot be "reduced to guinea pigs"

  • A plea has been filed in the Supreme Court by CASC
  • CASC is seeking stay on the trials of WhatsApp payment service
  • WhatsApp is in violation of data localisation norms: CASC

A plea has been filed in the Supreme Court seeking stay on the alleged trials of WhatsApp payment service being carried out by the instant messaging app on one million users in India, saying they cannot be "reduced to guinea pigs".

An NGO, Centre for Accountability and Systemic Change (CASC), which had earlier approached the apex court claiming that WhatsApp has not fully complied with RBI's circular which prescribed data localisation norms, told the apex court that WhatsApp is still not following the norms.

"WhatsApp is in violation of data localisation norms as per RBI (but) is clandestinely continuing beta testing of its Payments Systems on one million Indian users. Moreover, it has now been reported that WhatsApp Pay will be rolled out to more customers, despite there being no report submitted to this court about WhatsApp's full compliance with RBI Data localization norms," it said.

Financial and other sensitive personal data of one million Indians cannot be stored outside India, it said.

"One million Indians cannot be reduced to guinea pigs. Their sensitive personal data, including financial data cannot be stored outside India in contravention to the RBI circular," it said, adding that the US-based firm has not appointed its Grievance Officer in India.

WhatsApp had earlier told the apex court that it is conducting a trial run of its payment service and will comply with the Reserve Bank of India (RBI) norms on data localisation before launching the full service. It had also told the court that it will not launch payments services without fully complying with RBI norms. The Centre had said that WhatsApp was not complying with data localisation norms which was evident from the affidavit filed by the RBI.

To this, the bench had said that if norms laid down by RBI are not followed by WhatsApp, then it can be prosecuted. In its petition filed through advocates Vanya Gupta and Archana Pathak Dave, the NGO has sought direction to restrain the instant messaging platform from proceeding with its payment service unless it fully complied with the provisions of the RBI.

The Centre and WhatsApp had earlier told the court that a grievance officer for India has been appointed by the instant messaging service company. However, the NGO has claimed that grievance officer has been appointed in the United States of America, which is "preposterous and against the sovereignty of India".

It has referred to IT (Intermediary) Rules of 2011 and IT (reasonable security practices and procedures and sensitive personal data or information) Rules 2011 wherein provision is made for appointment of grievance officer. It has also said in its affidavit that it would be a paradox if data localisation norms are prescribed in India but companies are allowed to keep data officers in USA.

The apex court had earlier agreed to examine the plea which alleged that WhatsApp does not comply with the Indian laws including the provision for appointing a grievance officer. WhatsApp reportedly has over 200 million users in India and almost one million people are "testing" its payments service. India is one of the largest bases for the Facebook-owned company that has over 1.5 billion users globally.

In its plea, the CASC said that to open a bank account, a customer needs to comply with KYC norms laid down by the RBI and various other formalities. "WhatsApp is a foreign company with no office or servers in India. To run Payments Service in India, WhatsApp is obligated to have its office and payments in India," it said.

"Moreover, it is also required to have a Grievance Officer for users in India. Yet, it is being allowed to continue with its payments and other services, without any check," the plea claimed. The petition also alleged that the social media giant does not comply with tax and other laws of India, but its reach was such that it is used by everyone, be it a commoner or even the judges of the apex court.

It said every user has a number on WhatsApp but the messaging platform has no number through which its user can contact it for any grievance redressal. Pointing to alleged cases of internet-based crimes, it has claimed that the growth of such incidents was directly proportional to the growth of the user base of messaging services like WhatsApp.


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Further reading: CASC, WhatsApp, WhatsApp Pay, Supreme Court
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