The Reserve Bank of India (RBI) announced new guidelines on e-mandates or recurring payments through credit cards, which comes into effect from tomorrow, October 1, 2021.
The new rule is likely to impact those cardholders who already have put standing instructions on their cards for online payments. Services, where the auto-debit facility is mostly used, include OTT content platforms such as Netflix, Hotstar and Amazon Prime, utility bill payments such as those for electricity, broadband, mobile phones and so on.
While the new rule is aimed towards empowering the cardholder such that payments could only be made with the due consent of the user, existing standing instructions for these recurring payments might get affected.
The central bank had earlier extended the timeline for banks and other institutions to migrate to the framework for processing of e-mandates on recurring online transactions by six months.