Synopsis: This article explains the new rules by the RBI related to Auto-Debit payments and their impact on OTT subscriptions, UPI, cards payments etc .
Auto debit has become a major part of everyday life from Netflix subscriptions and SIPs to electricity bills and credit card payments, it is used everywhere. Now that RBI has introduced new e-mandate rules, the way these recurring payments work across UPI, debit cards, credit cards, and wallets is going to change.
What Is Auto-Debit / E-Mandate?
An auto-debit/e-mandate is a digital version of an instruction provided by a customer to their bank or financial institution. This instruction allows companies to automatically deduct recurring payments such as loan EMIs, utility bills, and subscriptions directly from your bank account, credit card, or UPI, this eliminates the need for manual payments and reduces late fees. For setting up an E-mandate the customer has to fill a consent form, authenticate their identity using Net Banking credentials, Credit/Debit Card details ,etc. Once the authentication part is done the bank sets up the recurring payment instruction and it is activated instantly. The maximum limit per transaction is ₹15,000 for Debit/Credit Cards, UPI, and PPI ,additional authentication is required for a higher limit.
What Are RBI’s New Rules?
No need for an OTP as payments up to ₹15,000 per transaction will be processed automatically after an initial Additional Factor of Authentication (AFA) setup. For specific recurring payments like insurance premiums, mutual funds, and credit card bills, the AFA-free limit will extend up to ₹1 Lakh. Banks will have to send an SMS or email at least 24 hours prior to the scheduled deduction, which gives customers the option to pause, revoke, or opt out. You can now set maximum transaction caps, check exact mandate validity periods, and revoke or modify any e-mandate via your bank or issuer’s platform at any time.
What Changes for Netflix, UPI & Subscriptions and How Will Users Benefit?
For users this news means fewer interruptions in everyday payments therefore less stress from at least one aspect of their daily life. Whether it’s your Netflix subscription, monthly SIP, electricity bill, or other recurring payments, auto-debits are now expected to become smoother with less failed transactions and less repeated OTP hassle for smaller payments. The new rules also give users more control, as banks will now send alerts and allow users to modify everything anytime.
Things Users Should Still Watch Out For
Even with better controls in place, users should still keep an eye on the subscriptions and auto-payments linked to their accounts because it is very easy to forget about unused apps or old subscriptions due to busy schedules. Those small automatic deductions can quietly become a big burden if they aren’t checked regularly.
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Conclusion
RBI’s updated auto-debit rules are meant to make everyday digital payments smoother, safer, and simple for users. While the new system adds more convenience and control, it’s still a good idea to regularly check your active subscriptions and auto-payments to avoid unwanted deductions.
Written by Shreya
