**Summary:**
This Reserve Bank of India (RBI) circular (DPSS.CO.PD No.1343/02.14.003/2019-20) issued on January 15, 2020, outlines measures to enhance the security of card transactions. Effective March 16, 2020, all Scheduled Commercial Banks (SCBs), Regional Rural Banks (RRBs), Urban Cooperative Banks (UCBs), State Cooperative Banks (StCBs), District Central Cooperative Banks (DCCBs), Payments Banks (PBs), Small Finance Banks (SFBs), Local Area Banks (LABs), Authorised Card Payment Networks, and Non-Bank PPI issuers are directed to implement the following:
1. **Card Activation:** New and reissued physical and virtual cards will be enabled for use only at contact-based points of usage (ATMs and Point of Sale (PoS) devices) within India. Cardholders must be provided with a facility to enable card-not-present (domestic and international), card-present (international), and contactless transactions.
2. **Existing Cards:** Issuers, based on their risk perception, may decide whether to disable card-not-present (domestic and international), card-present (international), and contactless transaction rights on existing cards. Existing cards that have never been used for online, card-not-present, international, or contactless transactions must be disabled for these purposes.
3. **Cardholder Control:** Issuers must provide cardholders with:
* A facility to switch on/off and set/modify transaction limits (within the overall card limit) for all types of transactions (domestic and international) at PoS, ATMs, online transactions, contactless transactions, etc.
* This facility must be available 24x7 through multiple channels: mobile application, internet banking, ATMs, Interactive Voice Response (IVR), and potentially at branches/offices.
* Alerts/information/status updates via SMS/email whenever there is any change in the card's status.
4. **Exemptions:** Prepaid gift cards and cards used at mass transit systems are exempt from these provisions.
5. **Publicity:** Issuers and card networks are instructed to widely publicize the provisions of this circular.
These directions are issued under Section 10(2) of the Payment and Settlement Systems Act, 2007 (Act 51 of 2007). For further information, contact P. Vasudevan, Chief General Manager, Department of Payment and Settlement Systems, Central Office, 14th Floor, Central Office Building, Shahid Bhagat Singh Road, Fort, Mumbai – 400001. Tel: 91-22-2264 4995; Fax: 91-22-22691557; email: cgmdpsscorbi.org.in.
Key Entities Referenced
Reserve Bank of India: The central bank of India, responsible for regulating the banking system.
All Scheduled Commercial Banks: Refers to all commercial banks in India that are listed in the Second Schedule to the Reserve Bank of India Act, 1934.
Regional Rural Banks: Regional Rural Banks (RRBs) are financial institutions in India operating at a regional level to provide basic banking services.
Urban Cooperative Banks: These are primary cooperative banks located in urban and semi-urban areas.
Payment and Settlement Systems Act, 2007: An act of the Parliament of India that provides for the regulation and supervision of payment systems in India and designates the Reserve Bank of India as the authority for that purpose.
Point of Sale: A Point of Sale (PoS) device is a machine used to process card payments at retail locations.
P. Vasudevan: Chief General Manager at Reserve Bank of India who signed the circular.
Mumbai, Maharashtra: The city in India where the central office of the Reserve Bank of India is located.
भारतीय �रज़व र् बक�
RESERVE BANK OF INDIA
www.rbi.org.in
RBI/2019-20/142
DPSS.CO.PD No.1343/02.14.003/2019-20 January 15, 2020
The Chairman / Managing Director / Chief Executive Officer
All Scheduled Commercial Banks (SCBs) including Regional Rural Banks (RRBs) /
Urban Co-operative Banks (UCBs) / State Co-operative Banks (StCBs) /
District Central Co-operative Banks (DCCBs) / Payments Banks (PBs) /
Small Finance Banks (SFBs) / Local Area Banks (LABs) /
Authorised Card Payment Networks / Non-Bank PPI issuers
Madam / Dear Sir,
Enhancing Security of Card Transactions
Over the years, the volume and value of transactions made through cards have increased
manifold. To improve user convenience and increase the security of card transactions, it has been
decided as under:
a) At the time of issue / re-issue, all cards (physical and virtual) shall be enabled for use only
at contact based points of usage [viz. ATMs and Point of Sale (PoS) devices] within India.
Issuers shall provide cardholders a facility for enabling card not present (domestic and
international) transactions, card present (international) transactions and contactless
transactions, as per the process outlined in para 1 (c).
b) For existing cards, issuers may take a decision, based on their risk perception, whether to
disable the card not present (domestic and international) transactions, card present
(international) transactions and contactless transaction rights. Existing cards which have
never been used for online (card not present) / international / contactless transactions shall
be mandatorily disabled for this purpose.
भुगतान और िनपटान �णाली िवभाग, क��ीय कायार्लय, 14वीमंिजल, क��ीयकायार्लयभवन,शहीदभगत�संहमाग,र् फोटर्, मम्ुबई - 400001
फोनTel: (91-22) 2264 4995; फैक् सFax: (91-22) 22691557; ई-मेलe-mail : cgmdpssco@rbi.org.in
Department of Payment and Settlement Systems, Central Office, 14th Floor, Central Office Building, Shahid Bhagat Singh Road, Fort, Mumbai -
400001
�हदं ी आसान ह,ै इसका �योग बढ़ाइएc) Additionally, the issuers shall provide to all cardholders:
i. facility to switch on / off and set / modify transaction limits (within the overall card limit,
if any, set by the issuer) for all types of transactions – domestic and international, at
PoS / ATMs / online transactions / contactless transactions, etc.;
ii. the above facility on a 24x7 basis through multiple channels - mobile application /
internet banking / ATMs / Interactive Voice Response (IVR); this may also be offered
at branches / offices;
iii. alerts / information / status, etc., through SMS / e-mail, as and when there is any
change in status of the card.
2. The provisions of this circular are not mandatory for prepaid gift cards and those used at
mass transit systems.
3. Issuers and card networks may give wide publicity to the provisions of this circular.
4. These directions are issued under Section 10(2) of the Payment and Settlement Systems
Act, 2007 (Act 51 of 2007) and shall come into effect from March 16, 2020.
Yours faithfully,
(P. Vasudevan)
Chief General Manager