What the latest autopay rules mean for your cards and subscriptions

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If you pay for OTT subscriptions, insurance premiums, electricity bills or mobile plans every month, autopay can save you from missed deadlines. But the system now works under strict RBI rules. These rules decide when a payment goes through, when an OTP is needed, and when a bank must stop a transaction. Knowing how these rules work helps you avoid sudden payment failures.

How to start autopay

You can activate autopay either on the merchant’s app or website, or directly through your bank for your debit or credit card. Once registered, the bank takes up to seven days to activate the mandate. If a bill is due within those seven days, you must pay it manually. When autopay is active, you authorise the bank to deduct the amount from your account on the due date. For debit cards, you must ensure the account has enough balance because banks can charge return fees if the payment fails.

How fixed and variable mandates work

Autopay comes in two forms. A fixed mandate means the amount is the same each month, such as a Rs 399 OTT plan. A variable mandate applies to bills that change each cycle, like electricity or water charges. Both operate under the same RBI rules, but the approval required depends on the amount deducted.

Why the Rs 15,000 rule is important

Any recurring transaction up to Rs 15,000 can be processed automatically once the mandate is registered. For anything above that amount, the bank must send a pre-debit notification asking for OTP approval. If you do not respond to the alert, the payment will not go through.

For certain categories like insurance and mutual funds, this limit is much higher. The bank can process recurring payments up to Rs 1 lakh without OTP. Even credit card bill payments by standing instruction work only up to Rs 1 lakh. If your bill is higher than that, you must approve it manually.

When additional authentication is required

The first recurring payment may need an OTP if it crosses Rs 15,000, or if the amount exceeds the limit you set at the time of registering the mandate. If registration and the first payment happen together, banks may combine the authentication. Any recurring payment above Es 15,000 later will also need

OTP each time. If the customer declines or ignores the notification, the bank must stop the transaction.

The role of the 24-hour alert

Banks must send a pre-debit message at least 24 hours before any recurring payment. This alert must show the merchant name, amount and date, and include an option to opt out or modify the mandate. This gives customers time to cancel or pause payments they no longer want.

Why only certain merchants are allowed

Autopay works only with merchants who meet RBI’s e-mandate standards. After you register a mandate, the bank sends you SMS or email confirmation with the details. If a merchant is not RBI-compliant, you must pay manually because autopay will not function for that service.

Information you must provide

During registration, merchants may ask for details such as consumer numbers, policy numbers, plan names and meter details. You must also enter the start date, end date and limit for the mandate if the amount varies.

What happens if your card is lost or blocked

If your card is lost, stolen, expired or blocked, autopay transactions will not be processed. You must delete the old mandate from the merchant’s platform or your bank’s website. After you receive a new card, you need to register the mandate again. Banks are not liable for failed payments caused by card blocks.

A strict but safe system

The updated autopay system makes recurring payments safer and more transparent, but also stricter. If you understand the limits, OTP rules and the importance of pre-debit alerts, you can use autopay comfortably without unexpected failures. A quick check of your mandates every few months keeps your payments running smoothly.