There is going to be a big change in the auto debit payment system from next month i.e. from 1st October.
New Delhi. There is going to be a big change in the auto debit payment system from the next month i.e. from October 1. The new auto debit payment system is likely to be implemented from October. Under this rule, banks and digital payment platforms like Paytm-phone pay (bank, paytm phone pay) will have to take permission every time before deducting installment or bill money (EMI Installment). They have to make such changes in their system that once the permission is given, the money should not be deducted automatically every time.
The Reserve Bank of India (RBI) had earlier said that recurring transactions using debit cards, credit cards, Unified Payments Interface (UPI) or other prepaid payment instruments (PPI) would require additional factor authentication (AFA).
What is Auto Debit System?
Auto debit means that if you have put electricity, gas, LIC or any other expenses in the auto debit mode in the mobile app or internet banking, then the money will be automatically deducted from the account on a certain date. If the rule of auto debit is implemented, then your bill payment method will be affected. To take advantage of this facility, your active mobile number must be updated in the bank. This is because the notification related to auto debit will be sent through SMS on your mobile number itself.
Message will be sent first
After the implementation of the new rules, banks will have to send a notification on the customer’s mobile 5 days before the payment due date. Reminder has to be sent 24 hours before payment. The reminder will contain information about the payment date and payment amount etc. There will also be an option to opt out or part-pay. This rule will be applicable after 30 September and from 1 October. Apart from this, OTP system has been made mandatory on payment of more than 5000.
The purpose is to prevent banking fraud,
RBI had issued these guidelines in view of banking fraud and the safety of customers. According to the current system, digital payment platforms or banks deduct from the customer’s account every month without giving any information after taking permission from the customer. There is a possibility of fraud due to this. This change has been made only to eliminate this problem.