The Reserve Bank of India has extended the deadline for its new rules on recurring transactions by another six months, bringing relief to millions of customers and businesses that use auto-pay for monthly bills and subscriptions.
The deadline on RBI’s new rule on additional factor of authentication that requires banks to send a one-time password (OTP) to customers to validate transactions above Rs 5,000 has been now postponed .the primary objective of the framework was to protect customers from fraudulent transactions and enhance customer convenience. based on a request from Indian Banks’ Association (IBA) for an extension of time till March 31, 2021, to enable the banks to complete the migration, Reserve Bank had advised the stakeholders in December 2020 to migrate to the framework by March 31, 2021. thus, adequate time was given to the stakeholders to comply with the framework.
The new rules require banks to send a notification to customers a day before their automatic payments are due, with a choice to opt out. as most banks have not yet updated their systems to comply with this requirement, most such transaction were set to fail.the extension aims to prevent any large scale “customer inconvenience and default.”
The extension will bring relief to millions of people who use recurring payments for various subscription services and utility bills, and to the companies that offer these services, from streaming platforms to news websites and even power companies.
The requirement of additional factor of authentication (AFA) has made digital payments in India safe and secure. the primary objective of the framework was to protect customers from fraudulent transactions and enhance customer convenience,”
To prevent any inconvenience to the customers, Reserve Bank has decided to extend the timeline for the stakeholders to migrate to the framework by six months.any further delay in ensuring complete adherence to the framework beyond the extended timeline will attract stringent supervisory action.
Post Your Comments