In a move to make payments through credit and debit cards safer and more secure, the Reserve Bank of India (RBI) has asked banks to put in place a system for providing online alerts for all card transactions irrespective of the amount.
So far, banks have been sending online alerts to the cardholders for 'Card Not Present' (CNP) transactions worth Rs 5,000 and above. Card-not-present (CNP) transactions are those where neither the card nor its holder are present at the point of sale such as online transactions, orders over the telephone or fax.
In circular issued recently, the banking regulator noted that the cases of unauthorised and fraudulent withdrawal from ATMs have been on the rise. "It is important to arrest the incidents of such frauds in order to further encourage card based transactions in the country where the use of credit/debit cards plays an important role," the RBI stated in the circular.
The central bank has asked banks to put in place the new system by June 30, 2011.
According to the latest RBI data, total card-based (both debit and credit) transactions in 2010-11 up to February 2011 stood at Rs 1.03 lakh crore.