23.9 C
India
Monday, July 4, 2022

Automatic payments linked to bank accounts may be disrupted from April 1

Must read

Best Deals

Automatic payments linked to bank accounts may receive some disruption from April 1 due to a transaction law made by the Reserve Bank of India (RBI). These payments include mobile debt, utility or other bills and subscription costs for OTT platforms. A new law has been passed by the central bank to add another layer to prove the authenticity of the transaction. In announcing the ordinance, the RBI stated, “Repeated transactions (domestic or cross-border transactions) using cards / PPIs / UPIs under the provisions / practices that do not comply with the above instructions will not take place on 31 March 2021.”

Keeping in mind customer service, banks have begun informing them of the new law. In accordance with legal requirements, the processing of recurring e-mandate transactions, registered on your credit or bank card other than the Factor of Authentication (AFA), will be terminated w.e.f. April 1, 2021. You can pay directly with your card on the merchant’s website or by applying, “Axis Bank told its customers.

Also Read : Purchase of wheat in Punjab rescheduled from April 10 to higher COVID-19 cases, crop ripening late

How will the transaction work now?

Banks and other payment platforms will be required to send a pre-transaction notice to the customer, at least 24 hours before the first automatic payment. The user will have to select the mode of this pre-transaction notification during the registration of the duplicate transaction plan. Options such as SMS and email will be available to users. In order to proceed with any transaction, customer approval will be required. The customer will also have the option to opt out of the transaction. Subsequent payments may be terminated without this step.

Also Read : E-commerce companies urge govt to maintain FDI policy

Is there a transaction limit in the rule?

Earlier, the RBI allowed transactions up to ₹2,000 to be exempted from the e-mandate based recurring transactions system. However, this was changed in a notification by the apex bank on December 4, 2020 when this limit was extended to ₹5,000. This means that recurring transactions above this limit will need additional authentication.

Also Read : The Indian economy is ready to go backwards but the increase in virus cases is a big risk

Subscribe to our newsletter

To be updated with all the latest news, offers and special announcements.

- Advertisement -

More articles

1 COMMENT

LEAVE A REPLY

Please enter your comment!
Please enter your name here

1,100FansLike
1,105FollowersFollow
100FollowersFollow
120FollowersFollow
500SubscribersSubscribe
- Advertisement -

Latest article

Recommended Deal