RBI's Auto Debit Rules Have Become Effective. Know More About Them Here
NDTV
Customers will need to re-register themselves with each of their payment instruments, whether it is a debit or a credit card
From October 1 onwards, all kinds of recurring or repetitive payments, especially made through credit and debit cards and which are of value of Rs 5,000 and above, are being preceded by a notification, 24 hours in advance, informing the customer about the scheduled payment.
The advanced notification for executing recurring payments to customers being sent by banks is meant for seeking the latter's approval for taking forward any such transaction, as per the new norms notified by the Reserve Bank of India (RBI).
If the customer's nod is not received, such transactions will not be executed. Under this new system, for any transaction of more than Rs 5,000, banks will send onetime passwords (OTPs) to customers. Those recurring transactions on a customer's credit or debit card, which don't comply to this new rule, will now be declined by banks, as this system has now become applicable since October 1, 2021.
In other words, only those transactions which have the customers' e-mandate will be successfully executed, as per the central bank's new guidelines.
