RBI (RBI) made its initialIt had stated that it was planning to impose additional factor of authentication (AFA) on recurring transactions through credit and debit cards and prepaid payment systems such as mobile wallets and now it is time for the new guidelines to be implemented. The new guidelines will apply to debit or credit card, OTT subscription and digital news subscription auto debit systems. There is no doubt that this decision of RBI will have an impact on crores of subscribers, as there are apprehensions that such transactions will be affected with the implementation of rules.
If the RBI’s new rules regarding auto debit (recurring transaction) are understood in easy terms, from April 1, banks will have to send a notification to the customer 5 days before the date of auto-debit payment. Payment will be made only when the customer approves. Not only this, if the payment is more than Rs 5,000, the bank will also send the OTP to the customer. Now the problem is that on one hand RBI is going to implement its new rules and on the other hand IAMAI (Internet and Mobile Association of India) says that most big banks have not prepared themselves for this, due to which banks Connected card networks will not be able to follow this circular. If this happens, crores of automatic recurring (auto-debit) payments due on debit or credit card from April 1 may fail.
However, the good thing is that such auto-debit payments will not be affected by UPI’s AutoPay system. Many big banks and their connected network partners have started informing their customers about the recurring payment process. Customers are being advised to adopt other alternative methods for such payments from 1 April.<!–
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