The Reserve Bank of India (RBI) has relaxed the norms for the two-factor authentication for online payment up to Rs 2,000, in a move aimed to simplify and encourage online transactions. The new norm will help customers to complete card-not-present (CNP) transactions under the specified limit without entering the additional factor of authentication (AFA) or the one-time password (OTP), according to the notification.
The move will also help the cab aggregators, online marketplace or any other online transactions for that matter. “The relaxation for AFA under such solutions shall be applicable for card not present transactions for a maximum value of Rs 2,000 per transaction across all merchant categories. Banks and card networks are free to facilitate their customers to set lower per transaction limits,” RBI said in a statement.
Till now, for making an online payment, users needed to enter the card details on the gateway and then they enter OTP to authenticate the purchase which is sent to customer mobile phone. The new model is an opt-in service, meaning that the users will have specific to the bank if they are willing to opt for it.
The banks and card networks cannot automatically activate this service , as a matter of fact, they have to take the consent of their users before going ahead. Customers on their part who opt in for this facility will have to go through a one-time registration in which they have to enter the card details and AFA by the issuing bank. Thereafter, the registered customers will not be required to re-enter the card details for every transaction at merchant locations that offer this solution and thereby save time and effort.