Credit cards and Debit cards have become an important part of an Indian’s spending behavior. The growing use of these payment modes has also made it necessary for the RBI to put in place measures to secure the transactions. As a result, the Reserve Bank of India has introduced a new set of rules that will apply to the usage of both the cards. Consumers will not only enjoy convenience but also assured of protection against fraud.
Read on to know of the host of regulations that have been issued by the RBI in 2020:
Domestic transactions only – Newly issued credit and debit cards can only be used for domestic transactions at ATM and point of sale terminals. Banks are also asked to apply the same rule on cards that will be reissued.
Contact the bank for enabling other facilities – For facilities such as online transactions, contactless transactions, and international transactions and more, the card holder will have to contact the bank. As was earlier, these transactions or services will no more be available on credit cards and debit cards by default.
Deactivation rights reserved to the bank – The bank or the issuer will hold the right to make decisions based on the risk perception. They can disable the cards to prevent transactions such as international, contactless and even domestic transactions. Even the existing cards that have never been used for the same can be mandatorily disabled.
Users can control the facilities – The new regulation will give users the option to control the facilities. A card holder will have 24/7 access to switching on and off any given facility such as ATM transactions, online transactions and more via their card. The control can be carried out through any of the channels including internet banking, ATMs or the mobile app.
Users can set transaction limits – The RBI regulatory will allow card holders the facility to also set limits on their transactions. This limit can be useful in preventing unwanted spends.
Not applicable on gift cards – The provisions set down by the RBI will not be applicable on products such as gift cards. Similarly, they are also not mandatory for cards used at mass transit systems.
The above stated regulations will come into effect from the 16th of March, 2020. Importantly, you must note that it will be applicable to both existing and new users of credit and debit cards.