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New Debit Card, Credit Card Rules From 1st October – Free PDF Download

 

Why new rules?

  • With the rise in banking fraud cases and thus to make digital payments using debit cards and credit cards more secure,
  • The Reserve Bank of India (RBI) has issued several new guidelines that will come intoeffect from today, 1 October 2020.

New cards

  • At the time of issue / re-issue, all debit, credit cards shall be enabled for use-
  • Only at ATMs and Point of Sale (PoS) devices within India.
  • Before the notification, most banks issued cards that, by default, could be used anywhere in the world.
  • If customers want to use their debit, credit cards outside India,
  • They would need to request their banks for the facility.

For existing cards?

  • For existing debit, credit cards,
  • Issuers may take a decision, based on their risk perception,
  • Whether to disable the card not present (domestic and international) transactions, card present (international) transactions and contactless transaction rights.

  • All banks, card issuing companies have been asked by RBI to disable online payment for all debit, credit cards,
  • That have never been used for online or for contactless transactions in India or abroad.

More preferences to the customers

  • As per new rules, people will now be able to register for preferences,
  • Auch as opt-in or opt-out services, spend limits and other services for online transactions, international transactions and contactless transactions.
  • Users will have 24×7 access to switch ON/OFF or change all transaction limits via all available channels — Mobile application / internet banking / ATMs / Interactive Voice Response (IVR).

NFC technology

  • Many banks have also been issuing cards based on near field communication (NFC) technology.
  • A merchant doesn’t need to swipe such cards or insert them in the the point of sale terminal.
  • These are also known as contactless cards.
  • Card holders will also get the option to enable or disable the NFC feature also.

What about other cards?

  • The new regulations apply to debit and credit card only.
  • Prepaid gift cards or those used at mass transit systems (such as metro) are not covered under this.

  • ATM skimming is a theft of card information
  • A small device, known as a skimmer, is used to steal the information.

Conclusion

  • These measures assume significance amid rising instances of cyber frauds, and will make debit, credit cards more secure and curb their misuse.
  • These directions are issued under Section 10(2) of the Payment and Settlement Systems Act, 2007.

Q) Which of the following statements regarding Contactless Payment are correct?

1- It is a secure method of transaction by using radio frequency identification (RFID) technology.

2- For such type of transaction, the card has to be at a minimum distance of 10 cm.

3- Transactions of upto ₹10,000 can be made through contactless payment.

  1. 1 only
  2. 1 & 2 only
  3. 2 only
  4. All of the above

 

 

 

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