Now Reading: Allahabad HC seeks RBI, NPCI reply on e-payment recipient control
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Allahabad HC seeks RBI, NPCI reply on e-payment recipient control
The Lucknow bench of the Allahabad high court has issued notices to the Reserve Bank of India and the National Payments Corporation of India over a plea seeking a recipient-side mechanism in…
The Lucknow bench of the Allahabad high court has issued notices to the Reserve Bank of India and the National Payments Corporation of India over a plea seeking a recipient-side mechanism in electronic payments. The public interest litigation, filed by Lucknow-based advocate Anupriya Agrawal, argues that account holders should have the option to accept or decline an incoming transaction before the money is credited.
A division bench of Justice Rajan Roy and Justice Manjive Shukla passed the order on August 24. The petitioner has sought directions to the RBI to issue guidelines within two months making an Accept/Decline option mandatory for recipients. The petitioner's counsel argued the current system lacks transaction-level control for recipients, raising concerns about customer protection, financial autonomy, and misuse prevention.
The court also heard counsel for the Centre before issuing notices. The Union of India, RBI, and NPCI have been made opposite parties. The matter has been listed for the next hearing after eight weeks.
Indian Opinion Analysis
This PIL targets a gap in India's Unified Payments Interface framework, where the payer initiates and authenticates every transaction while the recipient has no pre-credit veto. Under current NPCI rules, once a UPI payment is sent, it auto-credits unless the account is frozen or a dispute is filed after the fact. A mandatory accept/decline step would add a friction point that could slow high-volume merchant settlements but would give individuals control against unwanted credits such as phishing refunds or disputed loan recoveries. The RBI's 2019 guidelines on digital payment security already require explicit payer consent at each step, the court will examine whether similar recipient-side consent is needed. The eight-week timeline for the central bank's response sets the next milestone in November.
Source: hindustantimes.com
This brief was synthesised by AI from the source linked above.
