Guidelines for Issuing Banks (To be complied by 30 Sep 2021)🔗

RBI has issued the following guidelines for issuing banks to authorise mandates and collect recurring payments on credit cards, debit cards and prepaid instruments. RBI has announced this step to make card transactions safer and secured.

• All mandate registrations must go through Additional Factor of Authentication (AFA). AFA is a process wherein a customer receives an OTP or card PIN during modification or revocation of the mandate and the first transaction.
• AFA is mandatory for registering mandates on cards. The maximum limit for registering mandates is ₹5,000. You can refer to the RBI circular.
• At the time of registration, banks should provide customers with the option to choose the communication medium (SMS or email) to which the pre-debit notifications will be sent.
• Banks should send customers a pre-debit notification at least 24 hours before the actual debit. The notification must contain all the information regarding the upcoming debit. Customers should be provided with an option to opt-out of the particular debit or the mandate.
• Banks should also send a post-debit notification to the customers. This notification should contain all the information regarding the debit.
• Banks must provide customers with an online facility through which customers can withdraw from any e-mandate at any point in time. The customers will have to perform the AFA at the time of withdrawal.
• For all such withdrawn e-mandates, the acquiring banks should ensure that the respective businesses delete all customer payment information.
• Banks should set up redressal system to address customers grievances. Card networks should also have a dispute resolution mechanism in place.

Impact on Existing and New Mandates🔗

The impact of the new guidelines is given below:

Alternative Solution: UPI Autopay🔗

We will soon be enabling UPI Autopay on your Razorpay Dashboard. You can create a registration link that will allow your customers to choose UPI to make recurring payments.

MandateHQ: Helping Issuing Banks Comply with the RBI Circular🔗

The RBI has given a 6 months extension (till 30 Sep 2021) to all issuing banks to comply with the guidelines set forth in the circular.

• Razorpay has partnered with Mastercard to launch MandateHQ - a plug-and-play solution that will allow issuing banks to offer standing instructions on credit cards, debit cards and pre-paid instruments in compliance with the RBI circular.

• We are working with most of the issuing banks to on-board them on MandateHQ and ensure a smooth transition by 30 Sep 2021. We will keep you posted when banks start going live.

FAQs🔗

Given below are some of the frequently asked questions.