A lot of changes are coming to India’s financial ecosystem. Particularly where payment cards are concerned, the landscape will be very different compared to the previous decade.
A Change in Payment Card Features
In most countries, owners of a payment card don’t have to opt-in to online payments. Most will even allow for international payments without the holder performing any action. In India, that situation has now come to change. It is the result of a new set of rules by the central bank.
New cards issued by Indian institutions will no longer provide this functionality by default. Users need to enable support for online, international, and contactless transactions. If they do not do so, this functionality will remain inaccessible to users.
This marks for a very strange decision. India is often praised for its innovative approach to payments and financial solutions. Disabling most of this functionality on new payment cards by default feels counterintuitive. Additionally, the card payments volume continues to increase in the country every year.
At the same time, the new move makes sense. From a security point of view, it is better to protect customers at all times. Otherwise, it would be possible for criminals who obtain one’s payment information. The tradeoff between security and convenience is often a very tight line to walk.
It is important to note other core functionality is not affected by these rules. All cards provide access to ATMs and regular point-of-sale devices. PIN-based transactions and cash withdrawals will still work as soon as a card has been activated.
Innovative Activation Solutions
To activate contactless and international transactions, clients will have multiple options. Per rules by the central bank, a wide plethora of options will be introduced. One way is by using mobile applications native to the card issuer. It is also possible to do so through online banking, at a physical ATM, or by visiting a bank branch.
For issuers, new options are introduced as well. They can let customers turn these extra features off again. Furthermore, they can have users set up their own transaction limits for all types of payments. Putting more control in the hands of the end user is always a good thing. As far as a payment card goes, these changes are all positive, in the end.
The new changes will go into effect as of March 2020.