The Reserve Bank of India (RBI) on Wednesday extended the deadline to implement the additional authentication factor (AFA) system for processing regular online transactions to September 30. Due to this expansion, banks and financial institutions will have more time to process the migration to the new framework originally announced by the Central Bank in August 2019. Gadget 360 learned that merchants, through various industry bodies, urged the Reserve Bank of India and the government to retain the proposed system, as this is believed to disrupt the billing and subscription fees of automatic payment OTT (OTT) platforms in mobile phones, utilities, and other industries.
Citing the delay in the implementation of the new framework, the Reserve Bank of India said in a press statement that it has decided to extend the deadline by six months.
“The delays implemented by some stakeholders have resulted in inconvenience and defaults that may cause large customers. In order to prevent any inconvenience to customers, the Reserve Bank decided to extend the timetable for the migration of stakeholders to the framework by six months, namely Until September 30, 2021.” The Central Bank said in a statement.
It also warned that any further delays to ensure full compliance with the framework beyond the extended timetable will lead to strict supervisory actions.
The Reserve Bank of India initially released a framework for deploying AFA to conduct regular transactions with a value not exceeding Rs. Reached 2,000 rupees in 2019. However, the rule extended this rule to transactions not exceeding rupee in December last year. 5,000 per transaction, and inform banks and other stakeholders that they will need to migrate to the framework before March 31.
The implementation of this framework is expected to help bring more security to online transactions in the country. However, multiple industry sources confirmed to Advertisement Shout that major banks have not yet deployed the system to enable AFA to conduct repeated transactions.
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