New rule on direct debit transactions from next month
Starting next month, automatic payment rules are subject to change. The Reserve Bank of India (RBI) has previously said that recurring transactions using debit cards, credit cards, a unified payment interface (UPI) or other prepaid payment instruments (PPI) will require factor authentication. additional (AFA). A large number of credit and debit card users have set automatic payment instructions for a number of services ranging from electricity and gas to music and movie subscriptions, and the new rules have threatened to break down. wreak havoc for millions of users.
Banks have started to inform their customers about this new rule. “As per RBI’s recurring payment guidelines, wef 20-09-21, the standing instructions on your Axis bank card (s) for recurring transactions will not be honored. You can pay the merchant directly by using your card for uninterrupted service, ”reads a communication from Axis Bank.
In December, the RBI granted more time to migrate to the new framework by March 31, following a request from the Association of Indian Banks (IBA), which was later pushed back to October 1, 2021. . framework beyond the extended deadline will now attract strict surveillance measures, ”the RBI said.
“In accordance with the RBI guidelines on ‘Electronic Mandate Processing on Cards for Recurring Transactions’, as of October 1, 2021, existing / new standing instructions that have been / are registered without an additional authentication factor will be not processed. We will implement the solution as soon as possible ”, indicates Axis Bank on its portal.
RBI’s new rule on automatic debit and credit card payments from October 1: all you need to know
1) Any standing instructions set out on your credit card and debit card (both domestic and international) will not be processed without the additional factor of authentication.
2) The registration, modification, deletion of the mandate will require an additional factorial authentication (AFA)
3) Customers will receive a pre-debit notification (SMS / email) 24 hours prior to debit
4) Customers can unsubscribe from the transaction or mandate via the link provided in the pre-direct debit notification
5) Customers will be able to view / modify / cancel all standing instructions set on their card
6) Customers can set a maximum amount for each SI. If the transaction amount is greater than the maximum amount assigned by the customer, the pre-debit notification will include a link allowing the customer to authenticate transactions with AFA. Without this authentication, the transaction will not be processed.
7) Any recurring transaction for an amount greater than ??5,000 will require AFA each time the amount is debited.
8) If Standing Instructions for Bill Payments are posted to your bank account, there will be no change. If they are on your bank’s debit or credit card, they will be declined from October 1, 2021. For example, IF given on Netflix, Amazon, insurance payments will be disabled. However, SIs registered using bank accounts for mutual funds, SIPs, and EMIs will continue.
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