To be honest, I didn't understand your confusion... I am very much confused about your confusion...
, take it easy...
Only two things have changed from these guidelines:
1) A network provider can not restrict the issuer to tie up with them only ( its at the banks discretion to opt two or more networks... Banks may still can choose to be only one network if they want to be..
2) Customer's request to choose their desired network (IF and IF only the card is provided in two or more than two network variants).
Other than the above two everything else remains the same...
okay let me dissect your confusion...
Scanario 1)
Say Bank1 issue Card A on Visa and Rupay...
use case 1..
If VISA Card A is used at an international location, there won't be any issue.. at the same time if Rupay Card A is used at an overseas location , it may not be accepted.. So in this scenario , a customer most likely opt for VISA Card A.
Use Case 2..
If a customer's spends are mainly domestic spends and want to use this for UPI spends then his obvious choice is RUPAY Card A over VISA Card A..
What is currently happening is: When both VISA and RUPAY Card A variants
are available, the bank is not honouring the customers request of their choice and forcing them to use a card which is aganist their preference...
These guidelines provide a certainity to assure the customers choice be honoured and Banks can't deny thier request.
Very Very key point here is , this never forces a Bank to isuse the card on more than two networks in the first place...I t is completely upto the Bank whether to issue Card A on one , two or three networks..
Scenario 2:
Here is my confusion about your confusion...
In the above case, both cards are different with different feautures on two different netwroks. so we can't compare between these two cards.
And also Scenario1 and 2 also can't be compared because they are not apple to apple comparision...
And coming to your main confusion( I suppose I got it right this time around)..
You are thinking Rupay will drag down both Visa and Master to their low level of quality because of backing of Govt's big muscle... It will most probably not happen in a democratic and capitalist econemies... why because, there is a market for different categories of customers from the suppliers perspective in the commercial world...Marke evolves.. Market is very dynamic... A niche area today becomes mainstream once the goods/ services are commodotised... Change is the only certainity in the Market...
Time will tell the which scanario pans out in the future.. but for to Rupay to become a dominant player there is a very very long road to cross...