RBI Issues New Rules for Debit and Credit Cards

debit and credit cards
Dashmeet Kaur
| Updated: Jan 17, 2020 | Category: RBI Advisory

Considering the rising volume of card transactions, RBI has issued a new set of rules for debit and credit cards. On Wednesday, the Reserve Bank of India released new guidelines to enhance user convenience and security of card transactions. RBI acclaims that over the years, the value and volume of transactions made through cards have increased manifold.Let’s take an insight into the entire story.

Highlights of the RBI New Rules for Card Transactions 

RBI has issued new rules in regards to debit and credit cards under Section 10 (2) of Payment and Settlement Systems Act, 2007.  Here are the key points of the notification:

  • The Reserve Bank of India asks banks to enable domestic card transactions at PoS terminals and ATMs in India at the time of issuance or re-issuance of the card.
  • As per new rules, the customers shall have to set up separate services on their cards for transactions such as international, online, card-not-present, and contactless.
  • Further, for the existing cards, the issuers may decide based on their risk perception. The issuers candisable the card not present for domestic, international, and contactless transaction rights.
  • Also, existing cards that have never been utilized for international/online/ contactless transactions shall get disabled mandatorily for such purpose.
  • The debit and credit card users will have 24*7 access to either switch on/off or modify the transaction limits. Thereby the users can change transaction limits through different channels available like internet banking, mobile application, Interactive Voice Response (IVR), ATMs etc.
  • Moreover, the issuers facilitate cardholders to switch on/ off and set transaction limits for all types of transactions ranging from domestic and international to online transactions / contactless transactions at PoS or ATMs.
  • RBI provisions are not compulsorily for prepaid gift cards and the cards used at mass transit systems.

Note :- RBI new debit and credit card rules will come into effect from 16th March 2020.

The Purpose of RBI Guidelines

The fundamental objective of RBI for issuing new norms was to render a standard framework to the banks to align with the best customer practices. The banks have to follow new rules and regulations while issuing credit, debit, prepaid cards. Moreover, NBFCs and banks must adopt adequate safeguards and implement the latest guidelines of RBI to ensure that their card operations run on a prudent, sound, and customer-friendly manner. Also, the notification is a robust step to uplift the security level amidst the increasing cases of cyber frauds.

Also, Read:Effects of COVID-19 on NBFC Sector in India

  • 4
  •  
  •  
  •  
  •  
  •  
  •  
  •  
    4
    Shares
Dashmeet Kaur

Dashmeet Kaur is an experienced content writer, having proficiency in writing Legitimate content with comprehensive research. She also has a keen eye to detail and incorporating accurate facts.

No Comments

Leave a Reply

 

Related Articles

Checklist for NBFC Takeover
Dashmeet Kaur
| Date: Jan 10, 2020 | Category: NBFC, RBI Advisory

A Complete Checklist for Taking over an NBFC

NBFCs are prominent business entities that have proven their mettle to develop India’s economy. Catering a wide variety of financial services, Non-Banking Financial Companies has overthrown the traditional lenders or...

Read More
P2P Lending RBI Regulations
Monisha Chaudhary
| Date: Nov 06, 2017 | Category: NBFC

P2P Lending RBI Regulations – Future of P2P Lending in India

After immense discussion on P2P lending regulations in India, the Reserve Bank of India issued gazette notification dated 18th September 2017 stating that peer to peer companies who provide loan...

Read More
Small Finance Banks
Dashmeet Kaur
| Date: Nov 19, 2019 | Category: RBI Advisory

RBI Issue Guidelines for Licensing of Small Finance Banks in the Private Sector

Considering the financial needs of unserved sections of our society, RBI creates a new segment of banks called Small Finance Banks (SFB). It has the main objective of furthering financial...

Read More

ARTICLES

Hi! My name is Akanksha! Let's talk.