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The Reserve Bank of India (RBI) has proposed to increase the limits for UPIauto payments for certain transactions without requiring additional verification, like one-time passwords (OTP). This means users won’t need to enter an OTP for auto payments up to Rs 1 lakh for mutual fund subscriptions, insurance premiums, and credit card repayments. Previously, OTP-based authentication was required for auto payments exceeding Rs 15,000.This means that the new limit will be applicable for e-mandates made up to RS 1 lakh three kinds of payments: mutual fund subscriptions, insurance premium subscriptions and credit card repayments.
What RBI mandate says
According to the statement issued by RBI, “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 Rs 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 Rs 15,000, a need to enhance the limit has been expressed as adoption has been lagging. It is, therefore, proposed to exempt the requirement of AFA for transactions up to Rs 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.”
Benefits of UPI Auto Payments:
* Timely payments: Avoid late fees and penalties.
* Customization: Set up recurring payments for various amounts and frequencies.
* Flexibility: Modify, revoke, or pause recurring payments as needed.
* Security: Secure and convenient way to make recurring payments.
* Cashless: Avoid carrying cash and waiting in queues.
* Convenience: No paperwork or documentation required.
While making the announcement, RBI said, “e-Mandates for making payments of recurring nature have become popular among customers. Under this framework, an additional factor of authentication (AFA) is currently required for recurring transactions exceeding Rs 15,000. It is now proposed to enhance this limit to Rs 1 lakh per transaction for recurring payments of mutual fund subscriptions, insurance premium subscriptions and credit card repayments. This measure will further accelerate the usage of e-mandates.”
What RBI mandate says
According to the statement issued by RBI, “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 Rs 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 Rs 15,000, a need to enhance the limit has been expressed as adoption has been lagging. It is, therefore, proposed to exempt the requirement of AFA for transactions up to Rs 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.”
Benefits of UPI Auto Payments:
* Timely payments: Avoid late fees and penalties.
* Customization: Set up recurring payments for various amounts and frequencies.
* Flexibility: Modify, revoke, or pause recurring payments as needed.
* Security: Secure and convenient way to make recurring payments.
* Cashless: Avoid carrying cash and waiting in queues.
* Convenience: No paperwork or documentation required.
While making the announcement, RBI said, “e-Mandates for making payments of recurring nature have become popular among customers. Under this framework, an additional factor of authentication (AFA) is currently required for recurring transactions exceeding Rs 15,000. It is now proposed to enhance this limit to Rs 1 lakh per transaction for recurring payments of mutual fund subscriptions, insurance premium subscriptions and credit card repayments. This measure will further accelerate the usage of e-mandates.”
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