Digital money. Razorpay partners Mastercard to make recurring payments secure

K. R. Srivats Updated - July 08, 2021 at 11:18 AM.

Develops MandateHQ solution to help banks comply with the new RBI norms

FILE PHOTO: Mastercard Inc. credit cards are displayed in this picture illustration taken December 8, 2017. REUTERS/Benoit Tessier/Illustration/File Photo

Razorpay, a full-stack financial services company, has partnered with Mastercard to launch MandateHQ, a new recurring payment interface that will help banks comply with the new RBI guidelines on recurring payments.

Banks can adopt this MandateHQ solution in as little as seven days and enable their cardholders make recurring payments across their ecosystem in compliance with the RBI norms, Shashank Kumar, Co-Founder and CTO, Razorpay, told BusinessLine.

RBI framework

It maybe recalled that the RBI had issued a framework for processing e-mandates on recurring online transactions and had made additional factor of authentication mandatory for all recurring transactions below ₹5,000 on debit cards, credit cards, UPI and other pre-paid instruments. All stakeholders are required to ensure full compliance with the framework by September 30.

This RBI directive is applicable to all recurring payments, which were earlier debited automatically from customers cards (credit/debit/prepaid) for mobile, utility, and other recurring bills, as well as subscription payments for different OTT streaming platforms.

Kumar said that MandateHQ platform will help banks with end-to-end mandate life-cycle management, including creating, viewing, updating, cancelling and pausing mandates and processing debits for valid mandates. In addition, the mandate HQ platform will also help banks enable a 24-hour free debit notification via e-mail, SMS and WhatsApp. It will also provide end-users with a portal to manage card mandates, he added.

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“A lot of merchants are moving to digital economy, and our solution will help them charge their customers through debit cards and credit cards via recurring payments. It helps banks comply with RBI norms and enable their customers pay through digital payments. More importantly, it helps the consumers have a transparent view of all the mandates they have registered. With this solution, you as a consumer will always be in control of the mandates you had set up,” said Kumar.

Private banks

He also said that Razorpay is already piloting this solution with three private sector banks, and is in talks with 20 other banks to help integrate this technology into their existing payment infrastructure in the next few weeks.

Kumar also said that products such as MandateHQ will now encourage more businesses to start and adopt subscription-based business models. The new MandateHQ offering will help businesses across a variety of sectors such as insurance, utilities, content, SaaS, lending, and charitable donations, among others, to alter their payment models and introduce subscriptions, thereby delivering better value while sustaining revenue growth, he added.

Published on July 7, 2021 07:49