Under the new rule, which was earlier to be enforced from tomorrow, recurring transactions will require additional authentication by the customer
Transactions above that cut-off will require an additional one-time password (OTP) (File)
New Delhi:
In a reprieve for millions, the Reserve Bank of India has deferred a new rule requiring additional authentication for auto payments made from their accounts of mobile and other bills as well as subscription charges for over-the-top (OTT) platforms. The current system for recurring transactions will continue till September 30.
Under the new rule, which was earlier to be enforced from tomorrow, recurring transactions will require additional authentication by the customer (at minimum, at the time of setting up a new recurring payment) to proceed.
Initially, the rule was planned on recurring transactions worth up to Rs. 2,000. The RBI, however, announced in December that on the basis of requests from stakeholders, the limit was raised to Rs. 5,000.
Transactions above that cut-off will require an additional one-time password (OTP).
RBI in August 2019 notified all scheduled commercial banks, card payment networks, prepaid instrument issuers, and the National Payments Corporation of India (NPCI) about the big change for recurring transactions.
The rule will apply not just on banks and financial institutions offering credit cards, debit cards, and other prepaid payment instruments, but also on mobile payment wallets and platforms enabling UPI-based payments.