New Delhi: The Reserve Bank of India (RBI) has prolonged the timeline concerning auto-debit funds for utility payments and over-the-top (OTT) subscriptions by six
RBI had directed all banks together with RRBs, NBFCs, and payment gateways to adjust to AFA for computerized recurring payment by March 31, 2021, which the central financial institution has now deferred it until September 30.Â
The deadline on RBI’s new rule on extra issue of authentication that requires banks to ship a one-time password (OTP) to prospects to validate transactions above Rs 5,000. It is aimed toward makin digital transaction secure and defend prospects from fraudulent transactions.
However, a few of the gamers failed to satisfy the deadline and approached the RBI looking for extension of the deadline.
“It is, however, noted that the framework has not been fully implemented even after the extended timeline. This non-compliance is noted with serious concern and will be dealt with separately. The delay in implementation by some stakeholders has given rise to a situation of possible large-scale customer inconvenience and default. 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, i.e., till September 30, 2021. Any further delay in ensuring complete adherence to the framework beyond the extended timeline will attract stringent supervisory action,” the RBI round stated.
In August 2019, the Reserve Bank of India (RBI) had issued a framework for processing of e-mandates on recurring on-line transactions. Initially relevant to playing cards and wallets, the framework was prolonged in January 2020 to cowl Unified Payments Interface (UPI) transactions as nicely.
The requirement of Additional Factor of Authentication (AFA) has made digital funds in India secure and safe. In the curiosity of buyer comfort and security in use of recurring on-line funds, the framework mandated use of AFA throughout registration and first transaction (with leisure for subsequent transactions as much as a restrict of Rs 2,000, since enhanced to Rs 5,000), in addition to pre-transaction notification, facility to withdraw the mandate, and many others. The main goal of the framework was to guard prospects from fraudulent transactions and improve buyer comfort. Based on a request from Indian Banks’ Association (IBA) for an extension of time until March 31, 2021, to allow the banks to finish the migration, Reserve Bank had suggested the stakeholders in December 2020 emigrate to the framework by March 31, 2021. Thus, enough time was given to the stakeholders to adjust to the framework.
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