As of 1 October 2021, the Reserve Bank of India (RBI) mandated changes in the auto-debit rule came into effect.
This legislation impacts all customers using debit-/credit cards issued in India, as well as customers using Paypal billing agreements.
The legislation comes down to the following:
- Customers using these payment methods need to provide 2-factor authentication to set up their e-mandates for recurring transactions;
- Most Indian banks send their customers notifications of such auto-debit requests either via email or SMS;
- For any auto-payment transaction above 5000 rupees you further need manual authentication by means of a one-time password (for each transaction);
- Any auto-debit instruction which doesn't comply with the RBI regulations fails.
Resolution
Therefore, to be able to process such a payment, it is first necessary to contact your bank and set up 2-factor authentication.
Alternatively, you can proceed with paying using PayPal (a single transaction, since a PayPal billing agreement also requires 2-factor authentication to be present).
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