01 Oct 2020: Credit, debit card rules changed from today: Check details here
In a bid to make online transactions more secure and promote digital payments, the Reserve Bank of India (RBI) has changed several rules pertaining to credit and debit cards, which will come into effect from today, October 1.
Tellingly, the banks have been ordered not to extend international facilities to customers until specifically demanded.
Here's everything you need to know about the new rules.
Details: Credit/debit cards meant for use at only Indian ATMs
Now, customers will be able to choose services, linked to online, international, and contactless transactions, as per their liking.
RBI said that the re-issued or new debit and credit cards can be used only at domestic ATMs and Point of Sale (PoS) devices within India.
If customers need to use cards abroad, they will have to request their banks.
Details: Customer can change the preferences anytime they want
Further, RBI ordered banks to disable credit and debit cards, which haven't been used for transactions, within India or abroad.
The option to enable or disable services, change transaction limits will be available round the clock, as per the new rules.
Consumers can get it done through any of the available channels like mobile apps, ATMs, or Interactive Voice Response (IVR).
Option: Customers can opt out of "contactless card transactions" as well
RBI also provided card-holders with the facility of opting out of the NFC feature. Short for Near Field Communication, this technology lets customers make transactions without inserting the card in the machine. This feature sparked fears about illegal transactions.
"These directions are issued under Section 10(2) of the Payment and Settlement Systems Act, 2007 (Act 51 of 2007)," the top bank said.
Benefits: The current rules will make online transactions safer, feels expert
About RBI's directions, IndiaLends CEO Gaurav Chopra said the rules will restrict international usage and ensure no mishap happens.
"Many international e-commerce websites neither asks for a CVV pin nor sends a one-time-passwords (OTP) to confirm the transaction," he told CNBC.
Moreover, since customers can set limits on transactions, the damage can be mitigated in case their cards are stolen or lost, he explained.
Fact: New rules will save time, explained another expert
Similarly, Rajesh Mirjankar, Managing Director and Chief Executive Officer, Infrasoft Tech., said the new guidelines will save the time of both customers and banks. He said a person traveling abroad can activate the "international transactions" option easily and deactivate the same upon return.
Guide: A step-by-step guide on how to change preferences
In case you are informed by a bank that your card's services have stopped, you can restart them through net banking.
All you need to do is log in to your account, search for "services" in the menu section, and look for ATM cards. A new window will let you change domestic and international specifications.
Importantly, credit card spending limits will remain unchanged.