The Reserve Bank of India has issued new guidelines to secure debit and credit cards to counter rising number of bank frauds. The changes will be effective from October 1, 2020. The new rules have been issued for debit and credit cards to improve the security and convenience of card transactions.
The RBI had directed all banks to not unnecessarily give international facilities to customers' cards, unless the customer himself demands it.
Here are the changes when RBI's new guidelines are effective from October 1:
1. Customers will get the option to register for preferences such as opt-in or opt-out services, spend limits and other services for online transactions, international transactions and contactless transactions.
2. The debit and credit card services will only be enabled for transactions at ATMs (domestic) and Point of Sale terminals.
3. Both debit and credit holders will now be allowed to set up transaction limits.
4. The card holders will have the option to allow or not to allow a particular service on their credit-debit cards such as ATM, POS, E-Commerce or NFC.
5. RBI has asked all banks, card issuing companies to disable online payment for all debit, credit cards that have never been used for online or for contactless transactions in India or abroad.
6. Card holders will also get the option to enable or disable the NFC feature also.
Here's how the changes will benefit cardholders:
1. Many international e-commerce websites neither ask for a CVV pin nor send a one-time-password (OTP) to confirm the transaction. This new move will either restrict international usage and/or have a spending cap which makes sure no misuse happens.
2. Since the feature will allow card users to set a limit on transactions through various modes—ATM, POS, and card-not present transactions—it will reduce the damage caused if the card is stolen and missed or if there is a card skimming fraud.
3. These features will not have any impact on one’s credit card limit and the spend limits or restrictions can be changed any time through the mobile app or net banking.
