Online Payment New Rules: Starting next month, online payment regulations are set to become stricter. Relying solely on an OTP will no longer be sufficient; users will now also be required to authorize payments using biometric authentication or Face ID.

Online Payment New Rules: If you make online payments, be aware that new regulations are coming into effect next month. Following this, an OTP alone will not be enough to complete a transaction. Amidst the rising incidents of online fraud and cyber scams, the RBI has introduced changes to its online payment guidelines. Payments will now require “Two-Factor Authentication.” These new rules will come into force on April 1st. Let’s take a look at what changes are in store for digital payments starting next month.

What Will Be Required in Addition to an OTP?

The RBI has implemented new rules to enhance the security of online payments. Now, in addition to entering an OTP, users will also be required to authenticate their payments using biometrics or Face ID. Failure to do so will prevent the payment from being processed using just the OTP. This signifies the addition of an extra security layer to the payment processing workflow. Furthermore, while the process for making small-value payments from a trusted device and a regular location will remain simple, additional verification steps may be required when making payments from a new location or using a new device.

What Are the Benefits?

In recent times, there has been a noticeable surge in incidents of online fraud, resulting in significant financial losses for individuals. The introduction of these new regulations adds an additional layer of security to the payment process. Now, even if an unauthorized party manages to obtain an OTP, they will be unable to complete a transaction without the second factor of authentication. This measure is expected to curb scams resulting from incidents such as SIM theft, SIM swapping, or phishing attacks.

Banks Held Responsible for Compensation

According to reports, the responsibility for providing compensation to users—aimed at offering them financial relief—will now be placed upon banks and payment applications. If a bank or payment app fails to adhere to these regulations and a user falls victim to fraud, the bank or payment app in question will be solely responsible for providing full financial compensation.