The Reserve Bank of India (RBI) has rolled out a unified framework for e-mandates governing recurring digital payments, bringing immediate changes to how auto-debits are processed across the country. The revised system allows transactions of up to Rs 15,000 to go through without requiring additional authentication like OTPs, simplifying routine payments for users. Under the updated norms, customers can complete a one-time registration for an e-mandate using additional factor authentication (AFA). Once this step is completed, all recurring transactions within the Rs 15,000 cap will be executed automatically, eliminating the need for repeated verification.
Payments exceeding this limit, however, will still require authentication, ensuring an added layer of security for higher-value debits.
Unified Rules Aim To Simplify Recurring Payments
The new framework replaces earlier circulars, establishing a standardised approach for handling recurring transactions across various payment platforms. This move is expected to make processes smoother for payments such as subscriptions, utility bills, and EMIs. Additionally, the RBI has widened the scope of e-mandates to include cross-border recurring transactions, marking a significant expansion beyond domestic payments. Another notable change is that banks are no longer permitted to levy extra charges on customers for using the e-mandate facility.
While Rs 15,000 remains the general cap, the central bank has carved out exceptions for certain categories. Recurring payments related to insurance premiums, mutual fund investments, and credit card bills can go up to Rs 1 lakh without AFA, provided they are registered under valid e-mandates. These relaxations reflect the typically higher value and essential nature of such payments.
Alerts, Control, And Fraud Protection Strengthened
To improve transparency, the RBI has mandated that customers must receive pre-debit notifications at least 24 hours before any transaction. These alerts will include key details such as the merchant’s name, transaction amount, and debit date, allowing users to review and cancel mandates if necessary.
Post-transaction alerts and formal grievance redressal mechanisms have also been made compulsory. Customers now have greater control over their mandates, with the ability to modify, pause, or revoke them at any time using AFA. For variable payments, users can define upper limits to prevent unexpected deductions.
Strengthening consumer protection further, the RBI has extended its zero-liability policy for unauthorised electronic transactions to e-mandates, provided issues are reported in time. The central bank also stated that customers must be given the flexibility to choose how they receive transaction alerts, including SMS, email, and other available options.
