Apple Restores Card Payments For App Store, iCloud In India: Report

Apple has reportedly resumed accepting credit and debit card payments for App Store purchases and subscription services such as iCloud in India, nearly four years after withdrawing the option following regulatory changes introduced by the RBI.

According to a report by Moneycontrol, the feature is currently being tested with a limited group of users and is expected to be rolled out to all users over the coming months. 

Inc42 has reached out to Apple seeking comments on the development. The story will be updated based on their response.

The return of card payments follows Apple’s compliance with the RBI’s card tokenisation framework, under which merchants must replace stored card details with unique tokens issued by authorised card networks. The rules also require tokenised data to be stored locally in India.

Since Apple discontinued card payments, users in India have relied on UPI, net banking and Apple ID balance to pay for apps, games and subscriptions on the Apple app store.

The development is in the run up to Apple’s plans to launch Apple Pay in India. The company is said to have been working with banks and global card networks like ICICI Bank, HDFC Bank and Axis Bank for a potential rollout of the service in the country.

Apple Pay rollout is likely to happen in phases, as per reports earlier this year. In the first stage, Apple Pay is expected to focus on card-based contactless payments to allow users to add their debit or credit cards to Apple Wallet and make payments by tapping their iPhone or Apple Watch on NFC-enabled point-of-sale machines.

The tech giant has been working on laying the regulatory groundwork to launch its payments service in the country for some time now. 

Why Apple Stopped Accepting Card Payments In India

Apple’s decision to stop accepting credit and debit cards for App Store purchases and subscriptions in India stemmed from a sweeping overhaul of the country’s digital payments framework.

The changes began in 2019, when the RBI introduced new rules for recurring online payments to strengthen consumer protection. The framework requires banks to notify customers at least 24 hours before every automatic debit, allows users to cancel scheduled transactions, and mandates an additional layer of authentication, such as a one-time password (OTP), for payments above a specified limit.

Although the rules were initially slated to take effect in 2021, the RBI granted multiple extensions to give banks, payment aggregators and merchants time to upgrade their systems for the new framework.

Simultaneously, the central bank also rolled out its card tokenisation framework, barring merchants and payment gateways from storing customers’ card details and requiring them to use encrypted tokens issued by authorised card networks instead.

The new requirements proved challenging for several global technology companies that relied on stored card credentials for subscription billing.

In 2022, Apple informed users that recurring payments made using Indian-issued credit and debit cards could be declined because of the new regulatory requirements. 

The company subsequently removed card payments altogether for App Store purchases and subscriptions, asking users to instead top up their Apple ID balance through UPI or net banking to continue paying for services such as iCloud, Apple Music and Apple TV+.

The transition disrupted payments for many users, with subscription renewals failing after saved cards stopped working. 

For instance, Google warned users that automatic card payments would be affected by the new rules, while Netflix introduced UPI AutoPay as an alternative payment option for its Indian subscribers.

The RBI maintained that the new framework was designed to reduce payment fraud and improve the security of digital transactions by preventing merchants from storing sensitive card information.

The post Apple Restores Card Payments For App Store, iCloud In India: Report appeared first on Inc42 Media.