RBI soon to update norms for Digital Payments Security
In the world of digitalism, everything is turning online. The more we incline to being digital, the cyber security will be required to be top notch. It is no surprise that cyber crime is one of the major reasons why people are not incline towards digital payment routes. Time and again the government and the banks are trying to update their security to the fullest to make sure that the online payments are more secure and reliable. The announcement was a day later, when RBI temporarily barred HDFC Bank from selling new credit cards and launching new digital initiatives. The digital banking app of SBI has been facing service issues as on Thursday, second time in the previous week that the bank was struggling to provide its digital service. In the wake of the failures and frauds online, the RBI (Reserve Bank of India) has announced that they are going to issue new rules for digital payment security controls.
The central bank has announced that they will be putting out new Digital Payment Security Controls direction in 2020, in their statement on Development and Regulatory Policies. This announcement is aimed to ensure that digital transactions like Net Banking transfer, mobile banking, UP, Card payments etc. can be more securely without the risk of fraud and failure. These norms are established to ensure minimum risk of all online transactions. The statement issued by RBI is:
The statement said: Going by the pre-eminent role being played by digital payment systems in India, RBI gives highest importance to the security controls around it. Now it is proposed to issue Reserve Bank of India (Digital Payment Security Controls) Directions, 2020 for regulated entities to set up a robust governance structure for such systems and implement common minimum standards of security controls for channels like internet, mobile banking, card payments, among others. While the guidelines will be technology and platform agnostic, it will create an enhanced and enabling environment for customers to use digital payment products in more safe and secure manner. Necessary guidelines will be issued separately.
During the pandemic, it was observed that many digital frauds have been reported and is on the rise. Digital payment frauds are common but a spark in numbers have brought concern to the banks and government. Amidst the pandemic, there was a spike in online transactions as more people went for online payments than using cash and online purchase was more opted for. And this increase has showed surge in creating many problems for the portals like system failures and technical glitches. These problems did result to online frauds and it was observed that in the month of October 2020, the UPI processed 2.07 billion transactions worth 3.86 lakh crore. One of the reasons for this is the ‘work from home’ culture that is making it difficult for the banks to monitor the transactions and can easily make mistakes. Monetary risks are never taken lightly, and with the observed spike and lack of responsibility by the bank and digital glitches has resulted to this precautionary step by RBI.
How will it affect common people?
There will be no changes for the consumers using online payments and bank services. Currently, there are no new authentication methods and security protocols added or required for the UPI apps, debit or credit cards and mobile wallets. Customers can continue using the services like before as no further step of authentication has been added.
The contactless payment method limit has been increased from Rs.2000 to Rs. 5000. Earlier, in the contactless payment amounting to or less than Rs. 2000 can be paid without authentication, that limit has been increased to or less than Rs. 5000.