Debit card, credit card rule update: E-mandate limit for recurring payments increased

The Reserve Bank of India (RBI) on Wednesday increased the limit for e-mandate on debit and credit cards for recurring payments like subscriptions, insurance premia and education fees. The amount has been enhanced from Rs 5,000 to Rs 15,000 per transaction, RBI Governor Shaktikanta Das said while announcing the decisions of the Monetary Policy Committee (MPC).

The framework for processing of e-mandate based recurring payments was introduced by the RBI, keeping in mind the benefits of convenience, safety and security to the users.

The framework for processing of e-mandate based recurring payments, inter-alia, provides for an Additional Factor of Authentication (AFA) during registration, sending a pre-debit notification, subsequent recurring transactions to be executed without AFA, and an easier avenue to withdraw such mandates.

Under this framework, over 6.25 crore mandates have been registered in favour of a large number of domestic and over 3,400 international merchants, according to the RBI.

“To further facilitate recurring payments like subscriptions, insurance premia, education fee, etc. of larger value under the framework, the limit is being enhanced from Rs 5,000 to Rs 15,000 per transaction. This will further leverage the benefits available under the framework and augment customer convenience,” the RBI said in a statement.

The RBI raised the interest rate by 50 basis points to a two-year high of 4.9 per cent as it doubled down to tame inflation that has surged in the last couple of months. The rate hike comes on the back of a 40 bps increase effected by RBI at an unscheduled meeting on May 4.

Meanwhile, the central bank has upped inflation projection for the current fiscal to 6.7 per cent from 5.7 per cent forecast in April. RBI has retained its growth projection at 7.2 per cent for the current fiscal on the back of improvement in urban demand and gradual recovery in rural India.

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