A crisis has arisen in the payment system of one of the world’s largest economies

India’s payments system, one of the world’s largest economies, has been plagued by crises and numerous failures due to banks’ outdated technology, which has not kept pace with the growth of digital payments in the country, which has grown fivefold since 2017. About it writes Bloomberg.

Just this week, the Reserve Bank of India (RBI) banned the country’s fourth largest lender, Kotak Mahindra Bank, from issuing credit cards and attracting new customers through online services due to cybersecurity breaches, and a glitch in the ICICI Bank app exposed data of approximately about 17 thousand new credit card owners.

The story said India has invested heavily in its vast technology ecosystem in recent years to improve financial inclusion and bring hundreds of millions of citizens into the digital marketplace, but while the customer experience has improved, “the core layer and its architecture have not modernized at the same pace.” . This puts stress on servers and, according to a McKinsey & Company report, Indian banks lack the necessary infrastructure to adequately protect customer data and prevent leaks.

It is noted that while Indian Finance Minister Nirmala Sitharaman calls on financial institutions to modernize, the backend of most banks in the country, which spend almost one and a half times less of net profit on technology than their global counterparts, still relies on an “outdated system “