Reserve Bank of India issued new guidelines for the protection of security in an online transaction, the effect of such new guidelines will start from July 1, 2022.

 As per the new guidelines which are going to be affected from the next year, all the e-commerce websites which are used for online marketing and food delivery can’t be able to save the ATM card detail of the customers for the future transaction and people have to enter again the card details in every new transaction. And the customer can also use the Token method to use its card details and can give their consent to the site to make payment.

Highlights

• The new RBI’s regulations provide: card tokenization will not be necessary.
• As per the Rules, only two types of cards are allowed to be issued for the tokens. One is a Master card, second is a Visa issue card.
• No extra fee will have to pay by the customers for the process of Tokenisation as per the RBI rules.

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Reserve Bank of India has also issued such strict guidelines in 2020 during March month and prohibited the e-commerce websites from saving the customer’s payment details. The object of such guidelines was only to boost the security of customers. Further, to improve the security factors and make the details secure, the RBI regulatory body of such e-commerce websites enhance their guidelines in September this year. The Token will be done to explicit customers requiring the consent of the customers which will require the ‘Additional Factor authentication (AFA)’.

RBI has revealed in the press conference the note that such strict rule of prohibiting the e-commerce websites to store the data of the Card will have its effect from June 30, 2021, which was extended to December 31, 2021, and as of now, the date of the starting its effect has been extended to June 30, 2022.

After the inculcation of such regulations, the Tokenisation will replace the option for providing card details to the Code of any Algorithm or any token which will allow the customers to go through without giving its card details.

RBI Regulation’s Points

• On every new transaction, the customers will have to re-enter their card’s information to make the Payment.
• The regulations by RBI are going to start from July 1, 2022, in which the customers will not be able to save their card details on any of the e-commerce websites.
• To avoid the hassle which will be faced by the customers, the feature of Tokenisation will be given to the people to use its card details in the form of any Authentication code or any other info which will be required the consent of the customer.
• The e-commerce websites will have to ask the card network to encrypt detail with additional factor authentication which will be needed. And once the e-commerce website gets the encrypted details the customers will be able to save their card details for a future transaction.
• As for the current time, only master card and Visa provided cards will be allowed to use Tokenise facility and in the future, other cards of different financial services can use the token service.
• The new guidelines that are expected to behave effects from next year, must affect both the credit and Debit cards.
• These regulations of RBI will include only Domestic transactions and no any International transaction will fall under this Regulatory body.
• One of the serious concerns which will arise from the Tokenisation system is that will there be any extra charges for Tokenization then the answer is NO.
• The websites will show only four digits of the Tokens and including this the name of the bank and card network name will be shown.
• Customers do not have any obligations to use the process of Tokenisation as they can also use the entered card detail option to make the transaction. As the Token system is introduced by RBI to make the payment quicker but in the consideration of the security of card details.

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