New RBI policy guidelines to promote cashless transactions

06 May, New Delhi

Reserve Bank of India (RBI) has issued instructions on credit/debit card transactions, security and risk mitigation measures to enhance the security of card transactions for electronic payment transaction, the Lok sabha was informed Friday.

According to the new guidelines, banks have been advised to provide online alerts for all card transactions. They have been advised to put in place a system of providing additional factor of authentication/validation (2FA) for all card not present transactions using the information which is not available on the card, Minister of State for Finance Jayant Sinha said in a written reply.

Under the new guidelines, all new debit and credit cards will be issued only for domestic usage unless international use is specifically sought by the customers. Such card enabling international usage will have to be essentially EMV chip and PIN enabled, the Minister said. Customer induced options may be provided for fixing a cap on the value/mode of transactions/beneficiaries. In the event of customer wanting to exceed the cap, an additional authorisation may be insisted upon.

”RBI’s instructions on charges levied by banks on cards inter-alia mention that the banks should not levy any charge that was not explicitly indicated to the credit card holder at the time of the issue of the card without getting his/her consent. The debit card-issuing bank should also specify the basis of any charges levied,” he said.