New Auto Debit Payment System To Begin From Oct 1, Money Won't Be Deducted Without Approval
The new auto-debit system will come into effect from October 1. With its implementation, your banks or digital platforms will no longer be able to deduct money without your permission.
The auto-debit payment system is going to undergo major changes. The new debit payment system will be implemented from October 1. According to this new debit payment system, digital platforms like Bank and Phone Pay Paytm will now have to seek permission from you before deducting installments or bills. They will have to change their system in such a way that they will not be able to deduct your money without your permission.
What is Auto Debit System?
When you choose the auto-debit mode of payment for the mobile, water bill, and electricity bills, etc. the money is deducted from your account on a fixed date. This is called the auto-debit payment system.
What has changed?
Under the new auto-debit system, banks will have to send a notification to their customer's mobile number 5 days before the payment due date. After sending the notification, the approval of the customer should be taken. In addition, an OTP system has been made mandatory for payments of more than 5,000.
Your mobile number should be updated in the bank to get the facility of the new system. This is because the debit notification will be sent through SMS on your updated number. Keep in mind that the new debit system will be applicable only on the use of debit and credit cards or on the scheduled auto-debit payments on them.
What will change?
The main purpose of the new auto-debit system is to prevent fraud. Once digital payment platforms or banks get permission from the customer, they deduct money from the customer's account every month without informing the customer. There is a possibility of fraud due to this. Hence the important change has been made to eliminate this problem.
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