The Reserve Bank of India (RBI) has decided to increase the limit from ₹15,000 to ₹ 1,00,000 per transaction for subscription to mutual funds, payment of insurance premium and credit card bill payments.
Informing about the same, the bank in a notification stated, “A reference is invited to our circular CO.DPSS.POLC.No.S-518/02.14.003/2022-23 dated June 16, 2022 in terms of which relaxation in Additional Factor of Authentication (AFA) was permitted while processing e-mandates / standing instructions on cards, Prepaid Payment Instruments and Unified Payments Interface, for subsequent recurring transactions with values up to ₹15,000/-, subject to conditions listed therein.”
“In this regard, as announced in the Statement on Developmental and Regulatory Policies dated December 08, 2023, it has been decided to increase the limit from ₹15,000/- to ₹1,00,000/- per transaction for the following categories: (a) subscription to mutual funds, (b) payment of insurance premiums, and (c) credit card bill payments,” it added.
According to the Statement on Developmental and Regulatory Policies, the framework for processing of e-mandates for recurring transactions was introduced in August 2019 to balance the safety and security of digital transactions with customer convenience. The limits for execution of e-mandates without Additional Factor of Authentication (AFA) currently stands at ₹15,000/- (last updated in June 2022).
The number of e-mandates registered currently stands at 8.5 crore, processing nearly Rs. 2800 crores of transactions per month. The system has stabilised, but in categories such as subscription to mutual funds, payment of insurance premium and credit card bill payments, where the transaction sizes are more than ₹15,000, a need to enhance the limit has been expressed as adoption has been lagging, RBI said in the release.
“It is, therefore, proposed to exempt the requirement of AFA for transactions up to ₹1 lakh for the following categories, viz., subscription to mutual funds, payment of insurance premium and payments of credit card bills. The other existing requirements such as pre- and post-transaction notifications, opt-out facility for user, etc. shall continue to apply to these transactions. The revised circular will be issued shortly,” the bank had said.