RBI opens interoperable tokenisation for all: No edge for Apple and Google

The Reserve Bank of India (RBI) has fired a shot across the bow of global tech giants by mandating that tokenisation and authentication services must be offered on an open, interoperable basis. In its newly issued Authentication Mechanisms for Digital Payment Transactions Directions, 2025, the regulator has directed that if a device or operating system enables tokenisation, the feature must be accessible to all apps and payment providers in that ecosystem, not just to the company that owns it.

This move has significant implications for players like Apple Pay and Google Pay, which globally enjoy a competitive edge by locking core features such as NFC chips, secure elements, or tokenisation frameworks within their own apps. 

On the iPhone, for example, only Apple Pay can use the device’s NFC chip and tokenisation infrastructure, effectively sidelining third-party apps and giving Apple a gatekeeper role in mobile payments. This strategy has helped Apple capture a premium share of digital transactions in markets like the US and Europe, where regulators are still grappling with the anti-competitive impact.

RBI’s mandate disrupts this model. By insisting on open access, the regulator is emphasizing that if tokenisation is available on a device in India, then PhonePe, Paytm, or an SBI app must be allowed to use it on equal terms. This could transform the competitive dynamics of India’s payments ecosystem, preventing big tech companies from ringfencing critical infrastructure and ensuring that Indian fintechs are not locked out of advanced authentication technologies.

Tokenization, which replaces sensitive card numbers with randomly generated “tokens” during transactions, has become the global standard for securing payments. While Apple and Google have leveraged it to build dominance in their respective ecosystems, RBI’s framework ensures that no single player can monopolise tokenisation in India.

In effect, India is one of the few large markets to pre-emptively curb walled gardens in digital payments, a regulatory stance that could give local fintechs a level playing field while forcing global giants to open up their closed ecosystems if they want to operate in the country.