Apple stops accepting credit or debit cards for subscriptions, purchases
Apple users in India will no longer be able to use credit or debit cards to pay for subscriptions and app purchases. The change comes as a result of the Reserve Bank of India's (RBI) new auto-debit rules. The available modes of payments now are UPI, Net Banking, and Apple ID balance. Several Apple customers have taken to Twitter to complain about the removal.
Why does this story matter?
RBI brought the new rules on auto-debit to give customers the control back over apps and services. However, this change has put merchants in a tight spot as the implementation lacks finesse. Apple's unwillingness to accept card payments will affect customers as many still have their cards saved as the default mode. At the same time, this will be an impetus for UPI's growth.
Credit and debit card options are removed from payment methods
According to an Apple support page, the company has stopped accepting credit and debit card payments using Apple ID in India from April 18. Customers can only use UPI, Net Banking, and Apple ID balance for new purchases or ongoing subscriptions. Due to the change, even those who already have a card added as a payment method are unable to make payments.
New RBI rules on recurring payments are creating inconvenience
As per Apple's support page, the company has removed card payments due to the new auto-debit rules that came into force last October. The regulatory requirement has limited the company from receiving recurring payments via cards. Apart from the challenges presented by the new rules, the lack of updated systems dealing with the new rules has also put the company in a tough position.
Two-factor authentication and customer's consent required for recurring payments
According to the new RBI rules, for transactions of up to Rs. 5,000, customers have to go through a two-factor authentication after which an e-mandate would be set up for subsequent payments. For transactions above Rs. 5,000, customer's consent is required for every payment. Along with this, merchants like Apple also have to set up an e-mandate for customer cards.
