A day after Freshwork's CEO, Grirish Mathrubootham raised concerns about Reserve Bank of India's new auto-debit rules, another SaaS leader, Zoho Corporation, has voiced similar concerns.
In an emailed interview, Zoho said that this move has come as a challenge for businesses, which will have to modify the processes they have been following for a long time.
Isawaran said that RBI could come up with a scoring system to make it easier for businesses to comply with the new rules, and to give them some leeway for these trusted businesses.
He said that the RBI's new rule, which kicked in from October, puts the customers in the driver's seat while increasing security. The customer has the freedom to change the amount, the amount, and the duration.
The upcoming requirement of encryption of a customer's card details from January 1st is expected to curb unauthorised and fraudulent transactions. The regulations give customers granular control over how their money is collected, according to Isawaran.
Freshworks CEO said on Wednesday that the RBI should create a whitelist of companies that won't be affected by the new rules on payments. There is some improvement that we could do with RBI payment infrastructure for SaaS businesses where you have customers' credit cards on file. Mathrubootham said the rules are not helping SaaS companies.
The RBI states that there will be no automatic recurring payment for various services such as utility bills, recharge of phone, DTH, and OTT, as the additional factor of authentication AFA will become mandatory. banks will have to notify customers before payments above 5,000 and to send one-time passwords to the customers.
The new rules will not apply to loan repayments, simple investment plans SIPs stocks, etc.