We have covered countless articles on credit card and debit card frauds. Needless to say, the numbers have only increased despite the government taking precautionary actions in such cases.
We have also covered a detailed analysis of ATM frauds, which you can check out here.
Now, the Reserve Bank of India has issued some guidelines specifically for debit and credit cards, which will strengthen security and convenience of transactions, w.e.f Oct 1, 2020.
New Guideline w.e.f Oct 1
As per the new guidelines issued by RBI, card holders will individually be able to set and register preferences for their cards, targeting not just international and online transactions but also contactless card transactions.
RBI has mandated banks to incorporate risk-mitigation features in customers’ debit cards and credit cards from 1st October.
This means such cards issued by banks shall only be allowed for domestic transactions at ATMs and point of sale (PoS) terminals.
There is no such direction dictated for prepaid cards and gift cards.
In fact, the bank issuing your credit/debit card(s) will have the authority to deactivate your current cards and reissue them based upon the risk.
With this new feature, consumers can set up a limit on their credit cards and debit cards.
They will be able to switch on and off their debit and credit cards for any facility, like ATM, NFC, POS, or eCommerce transaction.
New Feature to Reduce Card Frauds
All card issuing companies have been asked by the RBI to disable online payment services for those debit and credit cards, which have never been used for online or contactless transactions, domestically or internationally.
A card holder will need to contact the concerned bank regarding enabling international transactions, to use their respective cards internationally.
Speaking of new cards, their users will only be able to use their services after registering them.
This is done to prevent card fraud and misuse, along with giving consumers better power to manage their own finances.
It is anticipated that by putting caps on spending and withdrawal, even if an individual gets prone to ATM or card fraud, the damage done will be minimised.
Additionally, cardholders can also enable and disable their NFC facility, the limit of which currently is Rs 2,000 per day without a PIN. They can also limit various transactions.
Significant Benefits for Cardholders
- Managing international spends
- Financial discipline
- Preventing card frauds
- Setting credit card limit
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