RBI on Friday has increased the without Additional Factor of Authentication (AFA)limit from existing ₹15,000/- to ₹1, 00,000/-per transaction for the following categories: (a) subscription to mutual funds, (b) payment of insurance premiums, and (c) credit card bill payments.
e- Mandate is a standard instruction that you provide to your issuing bank and other institutions, allowing them to automatically debit the mentioned amount from your bank account. The system provides electronic authorisation where individuals and companies do not need to go through repetitive manual transactions. Through e-Mandate, they can automate and set recurring payments.
How e-mandate works?
The first step you as a payer is to consent to the payee (entity receiving the payment) to initiate automatic deductions from your bank account. This can be done by filling out an e-Mandate form provided by the payee or through the payee’s website or mobile app.
The first step is for the payer (i.e., the person making the payment) to provide their consent to the payee (i.e., the person receiving the payment) to initiate automatic deductions from your bank account. This can be done by filling out an e-Mandate form provided by the payee or through the payee’s website or mobile app.
Once the e-Mandate form is filled out, you (the payer) must authenticate using your bank’s net banking credentials, debit card details, or any other authentication method provided by your bank.
The authenticated e-mandate is registered with the NPCI, which acts as an intermediary between the payer’s bank and the payee’s bank. The NPCI validates the mandate and forwards it to the payer’s bank (your bank) for processing.
The payer’s bank verifies the e-mandate and sets up a recurring payment instruction in their system. This allows the payee to automatically deduct payments from your account on the due date.
You can cancel the e-Mandate at any time by contacting your bank or the payee. In case of any disputes or issues, the NPCI acts as a mediator to resolve them.
Currently, the e- mandate feature is available for 36 major banks in India.
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