New rules for debit and credit card holders: Tokenisation requests are only registered with explicit customer consent via OTP.
By September 30, 2022, all credit and debit card data used for online, in-app, and point-of-sale transactions must be replaced by unique tokens, according to a directive from the Reserve Bank of India.
In April 2022, the Reserve Bank of India (RBI) published new guidelines for the issuance of credit and debit cards. These new regulations include new restrictions on credit card cancellation, billing, etc. The following are the three new credit card rules:
Interest rates
When interest is levied or compounded on credit cards, no unpaid fees, taxes, or levies are capitalised. “The terms and conditions for payment of credit card dues, including the minimum amount due, shall be stipulated so as to ensure there is no negative amortization. An illustration is included in the Annex. The unpaid charges/levies/taxes shall not be capitalized for charging/compounding of interest.”
The RBI has required that all credit and debit card data used for online, in-app, and point-of-sale transactions must be replaced with unique tokens by September 30 of this year. The tokenization-based additional layer of security will enhance the user experience for users making digital payments.
Card issuers will check for an OTP
Card issuers should ask the cardholder for One Time Password (OTP)-based consent before activating a credit card if the consumer hasn't done so in more than 30 days from the date of issuance. If permission is not granted within seven working days of requesting for it, card issuers are required to deactivate credit card accounts without assessing any fees to the customer.
Approval of the credit limit
The credit limit that has been approved and communicated to the cardholder must never be exceeded without the cardholder's express consent, according to card issuers.
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