Categories: Banking

RBI extends deadline for processing auto-debit payments by 6 months

The Reserve Bank of India (RBI) has extended the timeline for processing recurring online transactions by 6 months to September 30, 2021. Earlier in December 2020, RBI had directed all banks including RRBs, NBFCs, and payment gateways that the processing of recurring transactions (domestic or cross-border) using cards or Prepaid Payment Instruments (PPIs) or Unified Payments Interface (UPI) would not be continued beyond March 31, 2021, if they do not comply with Additional Factor of Authentication (AFA).

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This means that with effect from April 30, 2021, there were supposed to be no automatic recurring payment for various services, including recharge and utility bill, under arrangements/practices not compliant with AFA. However, banks and payment gateways had sought additional time to comply with the RBI directive on automatic recurring payment. Taking it into consideration, RBI decided to further extend the timeline.

Important takeaways for all competitive exams:

  • RBI 25th Governor: Shaktikant Das; Headquarters: Mumbai; Founded: 1 April 1935, Kolkata.

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Sumit Arora

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