Solution provider firm Razor pay said it has partnered with MasterCard to launch ‘MandateHQ’. This is a payment interface that will help card-providing banks enable recurring payments for their customers.
Razors pay which is backed by GIC, Sequoia Capital, and others aims to combine MandateHQ with more than 50 banks in the next 12 months.
RBI or central bank issued a frame for processing E-mandates on recurring online transactions. RBI has made Additional Factor of Authentication compulsory for all recurring transactions below Rs 5,000 on both credit and debit cards and UPI.
They have also stated that they spent significant time discussing with Banks, card networks, and subscription-based businesses to understand pain points. This was done to develop the best possible solution to address them.
In addition, the MandateHQ platform will also help banks enable a 24-hour pre debit notification via email, SMS, and WhatsApp while providing end-users with a portal to manage card mandates.
This directive applies to all recurring payments that were earlier debited automatically from customers’ cards (credit/debit/prepaid) for mobile, utility, other recurring bills, and subscription payments like OTT streaming services.
They have not yet disclosed with which companies they are collaborating with. They have stated that their target will be to combine MandateHQ with 50-plus banks in the next 12 months. They have now collaborated with 3 banks and they are also in talks to collaborate with 20 more banks.
MandateHQ will be a platform that will help banks with mandate lifecycle management including canceling, creating, updating, viewing, and pausing mandates along with processing the debits for valid mandates.
He said that the product development for MandateHQ began late last year, and after testing the product for a couple of months, the company is now ready to offer the solution to banks across India.
Kumar said that Industry prediction suggests that the market opportunity for recurring payments is between Rs 20 to 25 billion. There has been a 3X growth in recurring payments. This has continued to grow at 40% on a YoY basis over the past few years.
Clients will be notified by banks 24 hours before a mandate being debited, providing it enough time for a consumer to alter or cancel a payment.
