New RBI Rule for online payments<\/p>\n
The online payment process changed on April 1: The RBI has made a new rule: The digital payment system has changed in India from April 1. Two-factor authentication(2FA) is applied to all online transactions. In other words, every payment must be verified using at least two different methods.<\/p>\n
Under this new rule, users are required to utilize a password, PIN, OTP, biometric authentication, such as a fingerprint or Face ID, or another secure method when making a payment. A key feature of this mandate is that one of these verification methods must be dynamic, that is, unique, for every transaction; this ensures that no specific piece of information is reused, thereby minimizing the risk of fraud.<\/p>\n
The RBI has taken this step because, while digital payments have witnessed rapid growth over the past few years, there has been a corresponding rise in instances of online fraud, phishing, and unauthorized transactions. Previously, most systems relied heavily on OTPs; however, OTPs are no longer considered entirely secure, as hackers have devised various methods to intercept them. Consequently, the RBI has now decided to implement a more robust and secure system.<\/p>\n
According to the new guidelines, if a transaction results in fraud due to a failure to adhere to security protocols, the responsibility will lie with the bank or the payment company. This means that the customer will not have to bear the loss; instead, the concerned entity will be required to refund the entire amount. This will increase pressure on banks and fintech companies to further enhance the security of their systems.<\/p>\n