Reserve Bank Of India (RBI) recently announces new rules and regulations for the payments through the debit card or credit card.
The reason why RBI took this step is to enhance security and reduce the frauds with the peoples. Many peoples come under fraudsters words give their details which lead to transactions from their accounts.
In this news article, you will know about the new rules which will implement from the 1st of October 2020. Now, What are the new rules people should aware of?
Why RBI Is Implementing New Rules?
As you all know with the advancement in banking technology the government urges the people to do digital payments. Under the new vision of Digital India by our honorable Prime Minister Shri Narendra Modi.
The digital payments allow the cashless transactions which will save the paper as well as the time of the user. But with the advancement fraudsters are also advancing. Many people report the fraud case with digital payments.
Due to these reports of the fraud cases with the people the RBI decides to change the guidelines regarding the transaction from debit and credit card.
RBI new guidelines will implement from 1st October 2020. The reason behind this to provide safe banking transactions to banking users. Also reducing the number of fraud transactions in the upcoming years with these new guidelines.
New Guidelines By RBI For Debit/Credit Card
- Issuing New Cards From Bank
At the time of the new account opening, you receive the new debit/credit card or reissuing the debit/credit card when the validity of the card expires.
From 1st October 2020, the new debit/credit card issued by the bank will work inside India only. This means the card will work either at the ATM or any swiping machine during the shopping at any part of India.
Also, the card will work at the E-commerce websites to buy anything online but for India only. Before this guideline, the banks provide the cards which can be used anywhere in the world.
From now on according to the guidelines, the person who wants to do the international transaction needs to request their banks to avail of this facility. Otherwise, you will not be able to do any transactions outside the country for the new cards.
- What will happen to Existing Cards?
Nothing will change the for the users having old cards but to stop the services of international transactions it totally depends on the banks.
The RBI gives the guidelines to the banks regarding the old cards that it can stop or continue the transaction based on their risk perception. If the bank stops the international transactions on your card you will get a message from the bank.
Other than that you can use it for domestic purposes like shopping, withdrawing cash, and more.
Also, RBI told the banks to disable the online services for the cards which have not done the online transaction for a certain time period. This does not mean your card will disable but only the online transaction part will stop.
More Preferences To The Customers
According to the new Guidelines, preference will to the customers to opt in the services or not. Earlier there were some services in which the customer has to opt along with the card.
But from now on customers can limit their spending, online transactions as well as international transactions. Customer can choose the preference of the services which he/she want to opt.
Users have 24*7 access where they can switch On/Off or change all the transaction limit. This can be done by the Netbanking/ Mobile application/ ATM or through Interactive Voice Response(IVR).
Near Field Communication Technology where users can do payments without swiping any card in the POS machine. Since it does not requires any pin while doing the transactions.
In the new guideline, the user can either enable or disable NFC service on his debit card. Since there are so many fraudulent cases with this technology. This service is also known as contactless cards.
The new regulations apply to the debit and credit card only. Prepaid gift cards and the other cards use at mass transit does not cover in new RBI guidelines.
With these new rules and regulations, this will reduce the online frauds and ATM Skimming. Now the customer has more power and control over his card. By setting the limits on their card the fraudsters will not be able to cash out money more than set limits.
It will make debit and credit cards more secure for online transactions. All the rules will be stated under the Payments and Settlement System Act, 2007.