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When April 1 is observed as “Fools Day”, the banking system across India will undergo a massive change in the operation of the Automatic Recurring System.
In other words, there will be no automatic recurring payment from various services, including recharge and utility Bill as RBI has made Additional Factor of Authentication mandatory after March 31, 2021.
However, banks and payment gateways are seeking additional time to comply with the RBI directive on automatic recurring payment.RBI has to abide by their compulsions.
Records reveal that on December 4, RBI had directed all banks including RRBs, NBFCs, and payment gateways that the processing of recurring transactions ( domestic or cross- border ) using cards or Prepaid Payment Instruments (PPIs) or Unified Payments Interface(UPI) under arrangements/ practices not compliant with AFA would not be continued beyond March 31, 2021.
The same RBI’s directive holds ground. As a part of risk mitigation measure, its move was meant to bolster the safety and security of card transactions.
No - readiness of some of the players could impact recurring payment such as of utility bills, recharge of phone, DTH and OTT, among others, post March 31.