RBI extends timeline to comply with new rule for online transactions by 6 months

Mumbai: The Reserve Bank of India (RBI) on Wednesday extended the timeline for lenders, financial institutions and payment gateways to comply with its guidelines related to recurring online transactions with Additional Factor of Authentication by six months till September 30. This is the second time that regulator has extended the deadline as several players have failed to implement the framework which could have impacted recurring payments of customers such as of utility bills, recharge of phone, DTH among others, post March 31 and led to large scale defaults.

To make digital payments in India “safe and secure”, the banking regulator introduced Additional Factor of Authentication (AFA) and directed all banks including Regional Rural Banks, Non Banking Finance Companies (NBFCs) and payment gateways to comply with AFA for automatic recurring payment by March 31, 2021,