New RBI Rules on Online Card Transactions to Now Take Effect From July 1, 2022

To avoid the repeated hassle, customers can provide their consent to tokenise their cards.

New RBI Rules on Online Card Transactions to Now Take Effect From July 1, 2022

RBI has issued new guidelines to boost customers' privacy

Highlights
  • Card tokenisation is not mandatory
  • Only Mastercard and Visa-issued cards eligible for tokenisation now
  • Customers won’t need to pay extra fees for tokenisation
Advertisement

Starting July 1, 2022, e-commerce companies such as Amazon and Flipkart or online delivery aggregators such as Zomato won't be able to save card information on their platforms, under new guidelines from the Reserve Bank of India (RBI). As per the new rules, customers carrying out an online transactions on any e-commerce platform will need to enter their debit or credit card details each time starting next year. However, customers can avoid the hassle and choose to provide consent to the platforms to tokenise their cards.

Back in March 2020, RBI issued guidelines which restricted merchants from saving customers' card details in order to boost security. In September this year, the regulatory body enhanced its guidelines on card tokenisation services in order to improve the safety and security. "The tokenisation of card data shall be done with explicit customer consent requiring Additional Factor of Authentication (AFA)," RBI had said in a press release. To note, the deadline for merchants and other payment aggregators for storing card data was first set as June 30, 2021, then extended to December 31, 2021, and now, has been extended to June 30, 2022.

card saving screenshot gadgets 360 final card_saving_screenshot_gadgets_360_final

Only Mastercard and Visa-issued cards can be tokenised as of now
Photo Credit: Screenshot/ Gadgets 360

Tokenisation helps replace card details with a unique algorithm-generated code, or token, which allows online purchases to go through without exposing card details.

So, what does this mean for a regular customer? Here are 10 quick takeaways:

  1. Starting July 1, 2022, customers will not be able to save their debit or credit card details on any e-commerce platform.
  2. Customers will have to re-enter card details every time they conduct an online transaction.
  3. To avoid the repeated hassle, customers can provide their consent to e-commerce companies to “tokenise” their cards. After receiving a customer's consent, e-commerce platforms will ask the card network to encrypt details with additional factor authentication as needed.
  4. Once the e-commerce platform receives the encrypted details, customers can save that card for future transactions.
  5. For now, only Mastercard and Visa-provided cards can be tokenised by most leading e-commerce platforms. It is expected that cards from other financial services should be able to be tokenised soon.
  6. The new RBI guidelines must be adhered to for both credit and debit cards.
  7. The new guidelines are not applicable to international transactions. Only domestic cards and transactions fall under the gamut of the new RBI guidelines.
  8. Customers won't need to pay any extra charge for tokenisation of cards.
  9. E-commerce platforms will show the last four digits of tokenised cards for customers to easily identify them, along with the issuing bank and card network name.
  10. Lastly, tokenisation of card is not mandatory. Customers can choose to tokenise their cards to carry out quick transactions or enter card details otherwise.

Editor's note:: An earlier version of this article mentioned RBI's December 31, 2021 deadline, which has since been extended till June 30, 2022. The article has been updated to reflect this change.


What are the best phones of 2021? We discuss this on Orbital, the Gadgets 360 podcast. Orbital is available on Spotify, Gaana, JioSaavn, Google Podcasts, Apple Podcasts, Amazon Music and wherever you get your podcasts.
Affiliate links may be automatically generated - see our ethics statement for details.
Comments

For the latest tech news and reviews, follow Gadgets 360 on X, Facebook, WhatsApp, Threads and Google News. For the latest videos on gadgets and tech, subscribe to our YouTube channel. If you want to know everything about top influencers, follow our in-house Who'sThat360 on Instagram and YouTube.

Vivo V23 5G Reportedly Spotted on BIS, SIRIM Certification Websites, India Launch Seems Imminent
Realme 9i Tipped to Come With 4,880mAh Battery, Realme Pro+ May Feature 65W Fast Charging
Share on Facebook Gadgets360 Twitter Share Tweet Snapchat Share Reddit Comment google-newsGoogle News
 
 

Advertisement

Follow Us

Advertisement

© Copyright Red Pixels Ventures Limited 2024. All rights reserved.
Trending Products »
Latest Tech News »