Do you use recurring auto debit payment for payment of electricity, water or mobile bills generated every month? If yes, then according to the instructions of RBI, its rules will change from October 1, 2021. If you pay more than Rs 5000 through auto debit, then banks can ask for Additional Factor Authentication from you.
What is the new rule?
According to the new Additional Factor Authentication rule that will come into effect from October 1, 2021, the bank will have to send a notification 24 hours in advance to the customer to allow the bank to debit money from the account through any auto debit payment. The money will be debited from the customer’s account only when he confirms it. You can get this notification by SMS or E-mail. The notification will inform the card holder about the merchant, transaction amount, date and time of debit, transaction reference number/e-mandate and reason for debit. The cardholder will get an option to skip a particular transaction or e-mandate.
What you should do?
Therefore, customers paying through the card should link their correct mobile number with their debit and credit cards or update it so that the notification reaches you. If the standing order for auto debit is from your bank, then this new rule will not be applicable for mutual fund SIP, insurance premium payment and other recurring payments.
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These payments will be affected
The new rule will affect Netflix, Amazon Prime, Music Apps Spotify, Apple Music, mobile bill payments, insurance premium and utility bill payments made through debit, credit card or mobile wallet. It needs to be noted that Additional Factor Authentication is for recurring transactions and not just for one-time payments. Recurring payment refers to the recurring payment, such as electricity bill or mobile bill.
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