The e-commerce giant ‘Amazon’ has canceled its one-month Prime membership subscription plan for its Indian customers. This comes after a mandate issued by the Reserve Bank of India (RBI) effective since April 27. Amazon updated that their one-month Prime plan and free trial offers are discontinued in India following RBI’s guidelines.
What is new?
In an official statement, they have mentioned that from 27 April they are putting a temporary hold over the
(1) Free trails sign-ups for Amazon Prime
(2) New sign-ups for one-month Prime Membership (effective immediately till further notice)
What is Still Available?
However, the three-month Prime membership plan and the annual membership plan will be the same. Users can enjoy Amazon prime subscription benefits by enrolling in three-month subscription or annual Prime membership plans. For any users looking to purchase Amazon Prime membership or new membership that can buy the subscription plans of Rs. 329 (three-month plan) & Rs. 999 (annual subscription plan) and enjoy amazon Prime membership.
Reason Behind This
The main reason behind this is Reserve Bank of Indian issue a notice to the Banks and financial institutions for adding a security feature – AFA (additional factor of authentication) in case of recurring online transactions. All the Banks and Financial institutions are asked to adhere to the issues guideline and make sure that they get implemented by September 30.
The Additional Factor of Authentication (AFA) requirement is issued by the RBI as a step forward to make digital payments safe. To make repetitive transactions safer and secure it is necessary to add AFA during registration and first transaction (limiting the number of transactions and amount enhanced from Rs 2000 to Rs 5000) notification before deduction, withdrawal facility, etc to avoid any digital scam and protect users’ hard-earned money from any kind of theft.
Earlier RBI set the date for implementation of this framework set was December 2020 but after the request from the Indian Banks’ Association (IBA) the date gets extended to March 31, 2021. This allowed more time for the banks and financial institutions to adhere to the framework & comply with the RBI mandate. Reserve Bank of India set a deadline for the Additional Factor of Authentication (AFA) mainly to provide safe and secure digital transactions and a step forward towards the ‘Digital India’. Although the framework of the new mandate was established in August 2019 applicable to only cards and wallets. Later, the Reserve Bank of India extended it to Unified Payments Interface (UPI) transactions to improve the security & safety for UPI users as well.
The Reserve Bank of India’s (RBI) main objective behind issuing this mandate is to protect Indian digital users from any financial fraud and provide improved customer support. The deadline for the same extent to make sure the framework gets implemented effectively and prevents customers from any kind of inconvenience. However, it comes to light that financial institutions have requested the government to stall the new AFA system implementation as it can be a hindrance to the auto-payment system. Auto payments such as subscription charges of over the top (OTT) platform, EMI, bills, mobile and will suffer due to the implementation of the RBI new mandate.
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