From new life insurance guidelines to businesses opting for digital payment modes, here are the rules that are changing from February 1.
Businesses to be fined for not accepting select digital payment modes
To push cashless economy initiative, the Central government asked shops, business firms
or companies with an annual turnover of ₹50 crore or more required to provide digital facilities to customer from January this year. If the business fails to accept payments in the prescribed mode, a penalty will be charged from February 1. The penalty amount is set at ₹5,000 per day.
or companies with an annual turnover of ₹50 crore or more required to provide digital facilities to customer from January this year. If the business fails to accept payments in the prescribed mode, a penalty will be charged from February 1. The penalty amount is set at ₹5,000 per day.
"If the specified person fails to do so, he shall be liable to pay a penalty of five thousand rupees per day from 1st February, 2020 under section 271DB of the Act for such failure," Central Board of Direct Taxes (CBDT) said in a circular.
RuPay and UPI are among the prescribed mode of payment for digital transactions without any Merchant Discount Rate (MDR). The MDR is the percentage of the digital transaction that a merchant pays to banks. This cost is most often passed on to the customers.
New rules for Life insurance products
Life insurance products will witness a host of changes from today. To benefit customers, the Insurance Regulatory Development Authority of India (Irdai) has relaxed regulations for pension plans, Ulips and traditional life insurance plans.
In case of unit-linked products, the revival period has been increased to three years. For non-linked products the revival period will be five years. From February 1, withdrawal limit in pension plans is all set to increase. The maximum withdrawal allowed at maturity will be 60% instead of the existing one-third of the corpus.
Customers will be allowed to make partial withdrawal of up to 25% once the lock-in period of five years ends.
ATM cards rules for India Post will change
Do you have a savings bank account in post office? Starting from February 1, the existing Magnetic ATM cards will be blocked. The Magnetic ATM cards will be replaced with more secure EMV chip enabled ATM cards.
As of 31st December 2019, almost all banks have replaced Magnetic ATM cards with more secure EMV chip ones, as per Reserve Bank of India's guidelines.
