Winning Bizness Desk
Mumbai. The Reserve Bank of India has revised rules governing automatic payments to foreign service providers, giving users greater control over recurring transactions. The move directly impacts subscriptions on platforms such as Netflix and YouTube, where payments are deducted automatically. With the new framework, users will now receive advance alerts and can stop payments if needed, marking a shift towards tighter digital safeguards.
Advance alert to stop auto payments anytime
Under the revised rules, any e-mandate set up through cards or UPI for foreign services will trigger a notification 24 hours before the payment is processed. Banks will also be required to implement Additional Factor Authentication, typically through OTP verification, before completing such transactions.
The central bank has said the objective is to strengthen customer protection, reduce digital fraud risks and ensure that users remain fully aware of outgoing payments.
Transaction limits defined for recurring payments
The RBI has also introduced clear limits for e-mandate transactions. Customers can now decide whether a fixed amount should be deducted each time or set a maximum cap for recurring payments.
- Up to 15,000 rupees per transaction allowed without extra authentication
- Up to 1 lakh rupees permitted for credit card bills insurance and mutual fund payments
- Additional verification mandatory beyond prescribed limits
Banks must also obtain the maximum value from users in cases where flexible limits are chosen.
Mandatory verification for changes or cancellation
Any modification or cancellation of an existing e-mandate will now require fresh authentication from the user. This ensures that no changes can be made without explicit customer approval, adding another layer of security.
The rules also clarify that if a card is reissued after expiry, existing e-mandates can be seamlessly transferred to the new card without disruption. Besides, RBI has extended its existing customer liability framework to e-mandate transactions as well, offering clarity on refunds in case of errors or fraud.
- Zero liability if bank is at fault or issue reported within three working days
- Limited liability between 5000 and 25000 rupees if delay is between four to seven days
- Cases reported after seven days handled as per bank policy
These provisions aim to ensure accountability while encouraging timely reporting by customers.
No extra charges for e mandate services
The central bank has clearly stated that banks cannot levy any additional charges for providing e-mandate facilities on recurring transactions. This ensures that users can access enhanced security features without incurring extra costs.
- E-mandate services to remain completely free for customers
- Automatic mapping of mandates allowed on reissued cards
- Focus remains on convenience alongside stronger safeguards
The updated guidelines reflect RBI’s broader push to make digital payments safer, more transparent and user-friendly, especially as cross-border subscriptions continue to grow rapidly.
