Unable to make recurring payments via Credit, Debit Cards?

Getting a bunch of notifications for your old subscriptions and bill payments? OTT, phone recharge, even loan EMIs? Don’t stress, you’re not being spammed! This is happening because of new RBI rules. From October 1, 2021, every recurring payment needs an extra authentication step to add an extra layer of security. If you are paying your personal loan EMI via Debit Card, those payments too would be impacted.

How does this work?
Banks will send notifications 24 hours in advance to customers who will have to approve the transactions. The transaction will be carried out only once the customer has authenticated it.

Does this mean I will receive a notification every month?
No. For payments below ₹5,000, customers will have to go through a one-time registration process, and once this is done, subsequent transactions will not require additional authentication. Customers also have the option to cancel the transaction anytime.

What if the payment is over ₹5,000?
According to the new norms, if the payment is over ₹5,000, banks will have to send an OTP (one-time password) to customers. This two-factor authentication will have to be done for every payment.

What happens if I don’t register?
If you don’t register and your consent is not received, the transaction won’t be executed.

Why is the RBI doing this?
Short answer: To prevent fraud. The RBI has observed that cases of online fraud have been increasing, especially on third-party platforms. The RBI believes that this e-registration will give customers more power and control over their online financial transactions.  

Does this affect my mutual fund SIPs or loan EMIs?
No, it doesn't. The auto-debit rules don't apply to standing instructions via bank accounts for investments in mutual funds via Systematic Investment Plans or your loan EMIs.

However, keep in mind that these rules will affect the insurance premium payments that you are paying through your Debit or Credit Card.

If I still have doubts, how do I know what transactions will be affected and what won’t?
You’ll have to visit your bank website and check the list of merchants that fall under the new norms. For your Axis Bank cards, you may visit https://www.sihub.in/managesi/axisbank to see registered SI against your card. You will then have to re-register your Debit or Credit Card for each merchant individually. This will let merchants charge your card as per the schedule if the amount is less than ₹5,000. If it is ₹5,000 and over, you will get an OTP before every payment.

What if merchants don’t enable their systems to the new norms?
If your merchants haven't enabled their systems, you will have to visit the merchants' site every time a payment is due. It is a pain, but in the long-term, it is a move that is beneficial in preventing fraud, so just grin and bear it for a short period.

Axis Bank is one of the few banks whose systems are entirely tailored to meet the new RBI norms on recurring payments. For more information, visit Axis Bank.

Disclaimer: This article is intended solely for informational purposes. The views expressed in this article are personal. Axis Bank and/or the author shall not be liable for any direct or indirect loss or liability incurred by the reader arising from reliance on the content herein. Readers are advised to consult a qualified financial advisor before making any financial decisions. Axis Bank does not endorse or guarantee the accuracy of any third-party content or links included in this article.