In case an existing card has never been used online or for contactless transactions, these features stand mandatorily disabled.
In order to safeguard interests of bank account holders, the Reserve Bank of India (RBI) has asked banks to clip some features while issuing new cards. These features will have to be enabled by the user, depending upon their spending habits.
These include using card online both for domestic and international transactions, using them at international touch points and for contactless transactions.
In short, if you get a new card, it will not originally come with these features, unless you opt for it.
"At the time of issue/re-issue, all cards (physical and virtual) shall be enabled for use only at contact based points of usage (ATMs and Point of Sale devices) within India," RBI said in a press release.
Earlier norms allowed banks to issue cards with all in-built features so that customers could use them in multiple ways.
In case of existing cards, RBI said that banks may take a decision based on their risk perception.
Also, in case an existing card has never been used online or for contactless transactions, these features stand mandatorily disabled, the central bank said.
Moreover, card users will be able to switch on/off and set or modify transaction limits for all types of transactions, online or at a touch point, domestically or internationally.
RBI said that card users should be allowed to modify these features on a 24/7 basis through multiple channels.
Banks will have to notify customers through SMS/e-mail, whenever there is a change in the status of the card.This does not apply to other cards like prepaid gift cards and those used at mass transit systems, RBI said.Get access to India's fastest growing financial subscriptions service Moneycontrol Pro for as little as Rs 599 for first year. Use the code "GETPRO". Moneycontrol Pro offers you all the information you need for wealth creation including actionable investment ideas, independent research and insights & analysis For more information, check out the Moneycontrol website or mobile app.