The Reserve Bank of India has rolled out a comprehensive framework for digital payment e-mandates. The initiative aims to simplify recurring payment mechanisms while strengthening safeguards for users across UPI, prepaid payment instruments and card payments, both domestically and abroad.
The new guidelines remove the OTP requirement for recurring payments up to Rs 15,000. In addition, transactions including insurance instalments, mutual fund investments and credit card bill payments between Rs 15,000 and Rs 1 lakh can proceed without additional factor authentication.
The revised framework permits customers to register a single-use e-mandate after undergoing AFA. Following approval, recurring debits of up to Rs 15,000 can be processed seamlessly without repeated OTP validation. However, transactions beyond this cap will continue to be subject to authentication. This reinforces security for larger sums.
At the heart of the revised system lies the Rs 15,000 limit. It ensures that common expenses, ranging from OTT platforms to utility bills and EMIs, can be paid without constant user intervention.
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The RBI has allowed exceptions for key financial commitments. Recurring payments for insurance, mutual funds and credit card dues may be carried out up to Rs 1 lakh without OTP authentication, provided an e-mandate is in place. The policy reflects the higher-value nature and vital role of these outflows.
Enhanced transparency forms a key pillar of the new regime. Lenders and payment operators must now notify customers at least a day in advance of any debit, outlining details such as the merchant's name, the transaction value and the due date.
Users will have the flexibility to opt out or revoke the mandate before processing. Mandatory post-transaction alerts and complaint resolution channels have also been introduced.
Users retain full authority over their standing instructions under the new system. Recurring payment mandates can be modified, paused or withdrawn at any time, with revisions authenticated through AFA.
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In cases of fluctuating payments, customers have the option to set an upper cap to prevent debits exceeding a specified amount.
The RBI has applied its zero-liability policy to e-mandates in cases of unauthorised transactions. As a result, users will not be held responsible for fraudulent debits, as long as they notify the issue in time.
The overhaul incorporates overseas recurring transactions into the framework, marking a shift from its earlier domestic-only focus. Additionally, banks are not permitted to collect any fees from users for e-mandate usage.
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