RBI's Rules On Online Transaction To Be Effective From January 2022, Here's The 10 Key Points

New Delhi: As the 2021 is nearing to its end, people are eagerly waiting for 2022 and just with the starting of New Year, a couple of new guidelines of Reserve Bank of India (RBI) on online card transactions will come into effect.

The guidelines state that from January 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.

As per the new guidelines, the customers while making an online payment will have to enter their credit and Debit card credentials each time starting from the next year. If the customers feel uncomfortable with the said guidelines then in that case he/she can choose to provide consent to the platforms to tokenise their cards.

In March 2022, the apex bank had already issued guidelines which restricted merchants from saving customers' card details. Notably, in this year September, the banker's bank enhanced its guidelines on card tokenisation services in a bid to improve 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.

Tokenisation is the replacement of an actual or clear card number with an alternative code called the "token".

After creating it, the tokenised card details will be used in place of an actual card number for online purchases initiated by the cardholder. Customers do not have to pay for the service of tokenising their cards.

Now, let us understand the effect of new guidelines with 10 points.

--From starting January next year, customers won't be able to save their credit or debit card details on any e-commerce platforms.

--Each time customers will have enter their card credentials when they will make an online payments.

--However, customers can avoid this hassle by providing 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.

--After receiving encrypted details by the e-commerce companies, the customers can save that card for future transactions.

--Presently, the Mastercard and Visa-provided cards can be tokenised by most leading e-commerce platforms.

--The new guidelines must be adhered to for both credit and debit cards.

--Customers won't need to pay any extra amount for tokenisation of cards.

-- 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.

-- At last, tokenisation of card is not mandatory. Customers can choose to tokenise their cards to carry out quick transactions or enter card details otherwise.

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