The Reserve Bank of India has tightened and clarified rules around recurring payments, introducing a clearer framework for auto-debits under its e-mandate system.
The move aims to make digital payments smoother while ensuring stronger customer protection across platforms such as UPI, cards and prepaid instruments.
Under the new guidelines, recurring payments of up to Rs 15,000 will not require a one-time password (OTP). However, transactions above this threshold will need additional authentication, marking a key shift in how automatic payments are processed.
WHAT HAS CHANGED
The biggest takeaway from the new framework is the Rs 15,000 limit.
Payments up to Rs 15,000 can be processed automatically without OTPPayments above Rs 15,000 will require additional factor authentication
There is, however, a key exception. Payments such as insurance premiums, mutual fund subscriptions and credit card bills between Rs 15,000 and Rs 1 lakh can still go through without OTP under specific conditions.
The new rules apply across:
- UPI auto-pay
- Debit and credit cards
- Prepaid payment instruments
MANDATORY ALERTS BEFORE AND AFTER PAYMENT
To strengthen customer control, RBI has made alerts compulsory.
Customers must receive a pre-debit notification at least 24 hours before the transaction, clearly mentioning:
Merchant name, amount, and date of debit
Users will also have the option to cancel or opt out before the money is deducted.
In addition, post-debit alerts are also mandatory, ensuring customers are informed after every transaction along with details on grievance redressal.
NO CHARGES FOR E-MANDATE
The central bank has also clarified that no charges can be levied on customers for setting up or using e-mandates.
For card users, existing mandates can be mapped to reissued cards, ensuring continuity. Banks and payment service providers have been tasked with ensuring merchants comply with these rules.
RBI has extended its existing rules on limiting customer liability in unauthorised electronic transactions to recurring payments as well. This means users are protected even in case of fraudulent auto-debits, provided they report it within the prescribed timeline.
WHAT THIS MEANS FOR USERS
For consumers, the changes bring a mix of convenience and control.
Smaller payments such as OTT subscriptions, utility bills and app renewals will now be processed seamlessly without OTP interruptions. At the same time, higher-value transactions will continue to have additional safeguards.
The 24-hour alert system also gives users a window to stop unwanted deductions, addressing one of the biggest concerns around auto-debits.
The updated e-mandate framework reflects RBI’s broader push towards frictionless digital payments while maintaining strong consumer protection. As recurring payments become more common in everyday life, the regulator is trying to strike a balance between ease of use and security.
For users, the key is to stay alert to notifications and regularly track subscriptions, even as the system becomes more automated.
