Consumers can give e-mandate for recurring payments via UPI: RBI

Recurring payments to help users pay bills, subscriptions and even invest in SIPs

Consumers can give e-mandate for recurring payments via UPI: RBI

In a move to ease making payments for consumers, RBI has allowed recurring payments feature for Unified Payments Interface (UPI). Now consumers will be able to give an e-mandate for recurring payments to specified vendors, local shops or other services.

The recurring payments facility was earlier made available for debit cards, credit cards and mobile wallet-based payments. With this move, it has been extended to UPI transactions as well. Guidelines in place for cards and wallets will be applicable to UPI payments as well.

How will this change help?

By giving a standing order for certain recipients, UPI users can bypass additional factor authentication every time they make a payment. This will invariably speed-up the process and make it easier to make secure payments.

Users can easily pay for bills, subscriptions, etc. Merchants benefit too as this ensures timely payments to them.

This move is also expected to enhance adoption of Systematic Investment Plans (SIPs), wherein users can put an e-mandate for a fixed monthly amount that goes towards investments.

RBI has also taken steps to further boost security by limiting the amount for such recurring payments to Rs 2,000.

Related: How Unified Payment Interface (UPI) can change the way you bank

How can users register a vendor?

The process is simple. Users will have to provide few details such as the vendor’s name, payment limit as per the RBI mandate and the time frame in which they would like to make recurring payments. The additional factor of authentication will be done only once at the time of registration of the vendor.

For example, if a user buys grocery from the same shop every fortnight, they would know the average expenditure. They will have to input the merchant’s name, put the average cost limit and put the time frame of 15 days.

Related: Everything you need to know about the BHIM app

The user can choose between a fixed amount for recurring payments or for a variable value. The former can be used when the amount remains unchanged; for example, to pay for a Netflix subscription. The latter can be used random purchases at a local store. Users will have to specify a maximum value if they choose variable value – capped at RBI limit of Rs 2,000.

Related: Everything you need to know about Google Pay

Users can cancel the e-mandate for recurring payments at any time they wish. UPI is playing an integral role in building a Digital India. It is helping drive adoption of digital payments in all parts of the country. Adding recurring payments to UPI will give a further boost to India’s digital growth story.   Do you think you are digital savvy when it comes to payments? Take this quiz and find out. 


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