Razorpay row: Cause for concern for other digital payment brands?
Industry experts say while online payment firms have to be sensitive about user data, the controversy is unlikely to have a lasting impact on brand image
The recent controversy surrounding Razorpay sharing AltNews donor data with the police has once again raised concerns around user privacy in digital domains. The internet has been standing divided for the past few days discussing the legalities and the impact of Razorpay’s move but could it have a lasting impact on the brand image or digital payments at large in the country? Marketing experts disagree.
Speaking to e4m, an industry expert mentioned that the agitation was not certainly only against Razorpay as a brand but about privacy laws or the lack of it. “The brand image might not get impacted in the longer run. Social media controversies die out as soon as they blow up. But yes, they must be making an effort to ensure their existing users and partners that their personal data is safe,” they added.
Rashid Ahmed, Head of Digital, Infectious Advertising had a similar response. “If there's a legally valid request by relevant authorities in India, it would be required of a business or service systems provider to provide requested user information, in accordance with the law. Most large digital enablement service providers have fairly thought through and detailed usage and privacy policies, and a request for data would likely have required a sign-off in consultation with their legal teams. Since the payment gateway provides services to a large number of businesses, it is unlikely that a volume of users who chose not to use the gateway will make any significant impact on the overall base.”
Privacy concerns to grow
However, the concerns around user privacy will only mount with increased user awareness. In fact, it’s not the first time that Razorpay or digital payment gateways have gotten into such a situation. Just a few weeks ago, Razorpay had complained that the company was unable to reconcile receipt of Rs 7.38 crore against 831 transactions as hackers and fraudulent customers stole the amount. And in May 2018, Paytm had come under fire for a similar situation after Cobrapost reported that it had shared personal data of users in Jammu & Kashmir with the Indian government. Albeit, the platform had denied any such claims.
There is absolutely NO TRUTH in the sensational headlines of a video doing rounds on social media. Our users' data is 100% secure and has never been shared with anyone except law enforcement agencies on request. Thank you for your continued support.— Paytm (@Paytm) May 25, 2018
Samsika Marketing Consultants MD Jagdeep Kapoor pointed out, “Privacy is going to be a concern but the platforms, which will keep working ethically and protecting the user data will see no harm in the long run. Brands really have to be sensitive about user data.”
Subscription-based news platforms safe
Asked if the whole controversy could bar people from subscribing to news outlets as data sharing with payment partners would be inevitable, the experts said that the decision would solely rely on the content that such publishers produce, and not on payment gateways.
Kapoor highlighted, “Any industry these days: be it the payment gateways or publishers, or hotels, are taking a lot of user data. You cannot avoid sharing your data and therefore the onus to safeguard it lies on these companies. If a publisher is not tampering with your personal data or sharing it outside, I don’t think users will not subscribe.”
However, Ahmed felt that the subscription-based model might take a hit. “Many transacting users also have their financial details such as cards, tokenized and set up with their preferred gateways. So, this may also propel businesses to opt for multiple payment gateway service providers.”
Additionally, publishers and any such service providers might look for multiple payment gateways to give users the choice of preference. “Businesses requiring digital payment gateway services will likely opt for multiple service providers, to mitigate against service unavailability, or user preference where gateways is concerned. Many transacting users also have their financial details such as cards, tokenized and set up with their preferred gateways. So, this may also propel businesses to opt for multiple payment gateway service providers,” Ahmed said.
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