The Reserve Bank of India (RBI) has announced the auto-replenishment facility of FASTags and National Common Mobility Cards (NCMCs) when the customers’ balance falls below their set threshold. RBI’s August 22 circular states, “It has been decided to include auto-replenishment of FASTag and NCMC as and when the balance falls below a threshold set by the customer, under the e-mandate framework. Payments for auto-replenishment, since they are recurring in nature but without any fixed periodicity, will be exempt from the requirement of pre-debit notification.”

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The auto-replenishment of FASTag and NCMC was proposed in June 2024. The RBI circular seeks to implement three points through the circular:

• Whenever the balance becomes less than the threshold decided by the customer, FASTag and NCMC can be replenished as per the e-mandate framework.
• The requirement of sending notification of account debit 24 hours before the transaction for recurring and regular types of transactions is not required for recurring but irregular transactions.
• The changes for FASTag and NCMC are effective from August 23, 2024.

Changes Proposed In June 2024:

The e-mandate framework enables automatic recurring payments at fixed frequencies such as daily, weekly, monthly, etc. In June 2024, it was proposed to introduce automatic replenishment for recurring but irregular transactions under the e-mandate framework. Under it, it was also proposed to exempt the requirement of pre-debit notification before 24 hours for auto replenishment of the balances in FASTag, NCMC, etc., from the customers’ accounts.

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E-Mandate Framework:

• The e-mandate framework was issued in 2019. According to it, a customer with a debit/credit/prepaid card or a wallet can opt for the e-mandate facility for recurring transactions. For this, one needs to register for it, which is a one-time process. One also needs to validate it with the additional factor of authentication (AFA).

• The e-mandate could either be for a fixed amount or a variable amount. In the case of a variable amount, the cardholder needs to specify the maximum value subject to the RBI stipulated cap. A transaction beyond this limit cannot be completed automatically, but the customer needs to validate it using AFA.

• RBI has revised the cap for e-mandate several times since 2019, from Rs 2,000 per transaction to Rs 5,000 and then to Rs 15,000 in 2022.

• However, it was felt that the limit was low for recurring transactions like insurance payment premiums, mutual fund subscriptions, credit card bill payments, etc. Thus, in December 2023, RBI enhanced the limit for these transactions from Rs 15,000 to Rs 1 lakh.

Extending the e-mandate facility for FASTag and NCMC and the exemption from intimating customers about auto-replenishment is expected to boost digital transactions and convenience.