RBI increases e-mandate limit for recurring payments via credit, debit cards to Rs 15,000

The Reserve Bank of India raised the ceiling on mandates for recurring payments using credit and debit cards from Rs 5,000 to Rs 15,000 per transaction on Wednesday, June 8. On the same day, RBI Governor Shaktikanta Das announced the decision during the bi-monthly monetary policy committee meeting.

"The Reserve Bank created the framework for processing of e-mandate based recurring payments with the benefits of simplicity, safety, and security to users," Das said in a statement on the day. "Under this framework, over 6.25 crore mandates in favour of a significant number of local and over 3,400 overseas merchants have been registered," he added.

"To encourage larger-value recurring payments such as subscriptions, insurance premiums, and school fees within the framework, the cap is being raised from Rs 5,000 to Rs 15,000 per transaction," said the governor of the RBI. "This will further utilise the framework's benefits and improve client convenience," Das elaborated.

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The framework for processing e-mandate-based recurring payments includes, among other things, an Additional Factor of Authentication (AFA) during registration, sending a pre-debit notification, subsequent recurring transactions to be executed without AFA, and an easier way to withdraw such mandates, according to a statement issued later by the RBI.

According to the statement, demands have been made from stakeholders to extend the framework's limit to permit payments of greater value such as subscriptions, insurance premia, university fees, and so on. The RBI stated that "necessary instructions would be released shortly."

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RBI Governor Shaktikanta Das announced on Wednesday that the Monetary Policy Committee (MPC) agreed to raise the repo rate by 50 basis points to 4.90 per cent at its meeting from June 6 to June 8. As a result, Das increased the Standing Deposit Facility (SDF) to 4.65 percent and the Marginal Standing Facility (MSF) and bank rate to 5.15 per cent.