News Details- (Get Professional Updates on Whatsapp, Msg on 8285393786) More News

Banks To Decline Auto Pay Transactions From April 1

Posted Date : 31-Mar-2021 , 08:27:49 am | Posted By CASANSAAR print Print
Banks are likely to decline auto payments from April 1 as all recurring transactions using cards and prepaid payment instruments will now require an additional factor of authentication, as per an RBI circular first issued in December 2020. 

Transactions above ₹ 5,000 will require an additional one-time password. A notification will be sent to customers five days before an automatic payment is scheduled and the transaction will go ahead only if approved by the user. If banks decline automatic payments, the users will have to make manual transactions to complete their bill payments.

People use recurring mandates on debit/credit cards to pay for bills and subscription services such as OTT streaming, media, utility and postpaid services. Rejection of payment is likely to cause a huge disruption, with estimates suggesting that transactions worth about ₹ 2,000 crore could fail from April 1. UPI transactions will, however, remain unaffected by the new rule.

Third-party payment processors have also declined to share customer information with banks due to contractual agreements and this has further aggravated the problem.

The central bank has refused to extend the deadline, but the matter is expected to be resolved in the coming weeks.

In auto pay transactions, money is automatically transferred on a scheduled date towards payment of recurring bills such as credit cards and utility bills.

Category : Banking | Comments : 0 | Hits : 1376

Search News
News By Categories More Categories