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Discussion Forum : Would you allow a third party to deduct money directly from your credit card, without requiring your confirmation, each time you used its service? | Business Standard
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3yrs 7months 1weeks 3days 2hrs 25mins ago | COMMENTS [5] | Economy

Would you allow a third party to deduct money directly from your credit card, without requiring your confirmation, each time you used its service?

Popular taxi-hailing service Uber allows you to locate available taxis in the vicinity through the internet and summon them. Your credit card data is stored with Uber which deducts the fare automatically at the end of the ride and passes on the payment to the cabbie, thus saving you valuable transaction time. The RBI, however, says such transactions violate norms and are fraught with risks. If it has its way, popular service providers such as Google and Apple, which use a similar process for paid content and music, will also be affected. The counter argument is that the Uber model could potentially save as much as 91 million man hours of productivity. So, Should the RBI adopt this model for all players or should it bar it in its bid to protect consumers from possible fraud? Do share your views with us.

The idea of saving 91 million manpower hours certainly sounds like a game changer. The bigger question however is who assumes the risk and who reaps the reward? In my opinion saving 91 million man power hours offers enough cost saving for the system to develop a security that would protect the consumer against any potential fraud. Working out something similar to an OTP should create a win - win for both parties.
Wednesday 5th of August 2015 12:20:32 PM
I think there needs to be a distinction drawn between customers who choose to give out this information, knowing fully well that this data will be used to process their purchases. I find it hard to believe that the RBI can't imagine different ways for authentication of credit card transactions. One size fits all approach doesn't work. If I am regular buyer/receiver of a certain product of service, then I wouldn't mind my payment information being used by the portal or vendor. If I have authorized the original data to be stored on the server, while I was registering my card, through the two step verification process, then RBI norms shouldn't intrude in the domain of choice. Perpetual authentication in case of frequent users will only make the transaction staggered. I understand the requirement for authentication of a transaction. But, if a user makes a choice to share their payment information, then I don't think RBI norms should be a problem. Considering the RBI wants to dissuade cash transactions (by allowing banks to charge customers for withdrawing 'their' money from ATMs) I would think sanity would prevail on them. They shouldn't kill businesses by making a process cumbersome. They have already killed the ATMs. Please don't kill other businesses.
Tuesday 26th of August 2014 11:10:19 AM
Never allow for auto deduct whoever it may be. Authorization could be any kind but it is requried. Accept with RBI Move.
Monday 25th of August 2014 08:27:13 PM
Never do it. Not safe.
Monday 25th of August 2014 04:22:20 PM