Customers` rejoice! Contactless card transactions limit to be enhanced to Rs 5,000 from January 1, 2021

RBI said that the move is aimed to make payments in a safe and secure manner, especially during the current pandemic.

New Delhi: The Reserve Bank of India (RBI) on Friday said that the limits for contactless card transactions and e-mandates for recurring transactions through cards and UPI will be enhanced from Rs 2,000 to Rs 5,000 from January 1, 2021.

RBI said that the move is aimed to expand adoption of digital payment in a safe and secure manner. These are also well-suited to make payments in a safe and secure manner, especially during the current pandemic. This will depend on mandate and discretion of customers, RBI Governor Shaktikanta Das said.

"Contactless card transactions and e-mandates on cards (and UPI) for recurring transactions have enhanced customer convenience in general while benefitting from increased use of technology. These are also well-suited to make payments in a safe and secure manner, especially during the current pandemic. The recent instructions on disablement of contactless feature on cards and empowering customers to control the limits on their cards have also brought in added safety for users. To further the adoption of digital payments in a safe and secure manner, it is proposed to enhance, at the discretion of the user, the limits for contactless card transactions and e-mandates for recurring transactions through cards (and UPI) from ₹2,000 to ₹5,000 from January 1, 2021. Operational instructions will be issued separately," the statement on Developmental and Regulatory Policies by the Reserve Bank of India (RBI) said.

In other business friendly move, the RBI said that the Real Time Gross Settlement (RTGS) system, used for large value transactions, will be made available round-the-clock in the next few days.

In December 2019, the National Electronic Funds Transfer (NEFT) system was made available on a 24x7x365 basis.

Currently, RTGS is available for customers from 7.00 am to 6.00 pm on all working days of a week, except second and fourth Saturdays of every month.

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RBI Governor Shaktikanta Das said RTGS system will soon be made available 24x7 in the next few days... With this enablement, it is proposed to reduce settlement and default risk in the system by facilitating settlement of AePS, IMPS, NETC, NFS, RuPay, UPI transactions on all days of the week instead of five days earlier."