In partnership with Mastercard, fintech platform Razorpay has recently launched MandateHQ, a product to help banks comply with the Reserve Bank of India’s guidelines on recurring payments.
In a bid to make recurring payments in India safer, the RBI introduced an ‘Additional Factor of Authentication’ (AFA), where it asked banks to notify their customers 24 hours in advance about any recurring payments, and only process it once they get the go-ahead. The pre-transaction notification via SMS or email will have to include the name of the merchant, the amount due, and the date and time of debit, the central banking authority said. The new rule will be applicable to all types of recurring payments, such as phone bills, OTT subscription charges, SIPs, etc., as per the RBI.
Razorpay’s API-based plug-and-play product is expected to help make this process a lot easier for banks by helping automate the entire process, end-to-end — right from creating, viewing, and updating the recurring payment mandate, to cancelling and paying them as per the customer’s inputs. The platform will also help banks enable a 24-hour pre-debit notification via email, SMS and WhatsApp, as well as provide end-users with a portal to manage card mandates, the company said in a statement.