India cuts 2-step authentication for small transactions

RBI

The Reserve Bank of India (RBI) has agreed to simply the contactless payment process for transactions of under Rs 2000.

Customers will now only need to go through a single authentication step, instead of the current two-step system that many find overly cumbersome.

To protect against fraud, the RBI had said in August that all card payments would need to adhere to this system, stifling companies such as Uber that market themselves as a seamless payment experience.

However, the Bank now says that it feels the requirements are unnecessarily onerous for small value transactions.

In a statement, RBI said that “customers and entities in certain niche segments” had requested changes to the rules that would “foster innovative payment products / processes and [enhance] the convenience factor in certain use cases.

“The requests have been examined from the perspective of the trade-off between security and convenience in card transactions and need for relaxation in extant instructions with suitable safeguards to protect customer interest in light of availability of new technologies. One such technology is that of Near Field Communication (NFC) which is used in contactless cards.”  

 

 

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