No More OTPs: No Need to Enter OTP for Auto-Payments Up to ₹15,000—Learn About RBI’s New Rule

RBI Digital Payments Rule: To enhance the security of digital payments, the RBI has implemented a new ‘E-mandate’ rule. Under this framework, auto-payments (recurring payments) of up to ₹15,000 can be processed without an OTP; however, for amounts exceeding this limit, an OTP will be mandatory.

RBI Digital Payments Rule: The Reserve Bank of India (RBI) has issued new regulations regarding e-mandates to further bolster the security of digital payment transactions. These guidelines have been designated as the “Digital Payment-E-mandate Framework 2026” and have come into effect immediately. Under these guidelines, an Additional Factor of Authentication (AFA)—such as an OTP—has now been made mandatory for recurring transactions (payments).

What is an E-mandate?

An e-mandate is a facility that allows a customer to grant prior authorization for a payment, enabling funds to be debited automatically at a scheduled time. The payment amount can be either fixed or variable; however, for variable amounts, customers will be provided with the option to set a maximum transaction limit.

When will AFA (OTP) be required?

• Individual transactions of up to ₹15,000 can be processed without an OTP.
• If you initiate a transaction exceeding ₹15,000, an AFA (OTP) will be mandatory.
• However, for payments related to insurance premiums, mutual funds, and credit card bills, transactions of up to ₹100,000 are permitted without an OTP.

Notifications and Controls

• Customers will receive a notification at least 24 hours prior to each scheduled transaction.
• This notification will contain all relevant details, including the merchant’s name, the payment amount, and the date and time of the transaction.
• Customers have the option to choose their preferred mode of notification—either via SMS or email.

What are the rules for modifications and cancellations?

• If you wish to modify or cancel an existing e-mandate, an AFA (OTP) will be required to authorize the change. A customer can opt out of any transaction.
  The opt-out process will also be validated via AFA.

How will the first transaction take place?

Regarding the first transaction, it will always be executed with AFA validation.
However, if the payment is made at the time of registration itself, both processes can be completed simultaneously.

In which cases is a notification not required?

For e-mandates registered for the auto-replenishment of FASTag and National Common Mobility Card (NCMC) balances, a pre-transaction notification is not required.