 "Reserve Bank of India, RBI")
The Reserve Bank of India (RBI) on Friday said that it will shortly release a circular marking the upward revision in the limit of e-mandates for recurring online transactions without Additional Factor of Authentication (AFA) to Rs 1 lakh from the existing Rs 15,000 for subscription to mutual funds, payment of insurance premium, and payments of credit card bills.
The move is believed to further encourage transactions through the digital payment channels in the country.
The framework for processing of e-mandates for recurring transactions was introduced in August 2019 to balance the safety and security of digital transactions with customer convenience. The number of e-mandates registered currently stands at 8.5 crore, processing nearly Rs 2,800 crores of transactions per month.
The system has stabilized, but in categories such as subscription to mutual funds, payment of insurance premium, and credit card bill payments, where the transaction sizes are more than Rs 15,000, a need to enhance the limit has been expressed as adoption has been lagging.
Therefore, during the monetary policy on Friday, RBI Governor “proposed to exempt the requirement of AFA for transactions up to Rs 1 lakh for the following categories, viz., subscription to mutual funds, payment of insurance premium, and payments of credit card bills,”
The Governor further added, “The other existing requirements such as pre- and post-transaction notifications, opt-out facility for users, etc., shall continue to apply to these transactions. The revised circular will be issued shortly.”
