RBI MPC Meeting (February 2024): The Reserve Bank of India today proposed to allow adoption of technologies other than SMS-based OTPs for authentication of digital payments.
In its bi-monthly “Statement on Developmental and Regulatory Policies”, the central bank proposed to adopt a principle-based framework for authentication of digital payment transactions.
“Over the years, the Reserve Bank has prioritised security of digital payments, in particular the requirement of Additional Factor of Authentication (AFA). Though RBI has not prescribed any particular AFA, the payments ecosystem has largely adopted SMS-based One Time Password (OTP),” the RBI said.
“With innovations in technology, alternative authentication mechanisms have emerged in recent years. To facilitate the use of such mechanisms for digital security, it is proposed to adopt a principle-based ‘Framework for authentication of digital payment transactions’,” it added.
The RBI will issue instructions for new authentication methods separately.
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RBI MPC Meet Keeps Repo Rate Unchanged
Meanwhile, the RBI today kept the Repo Rate unchanged, a move which will provide extended relief to borrowers.
The RBI said that the Monetary Policy Committee at its meeting today (February 8, 2023) decided to keep the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 6.50 per cent.
“The MPC will carefully monitor any signs of generalisation of food price pressures to non-food prices which can fritter away the gains in the easing of core inflation. As the path of disinflation needs to be sustained, the MPC decided to keep the policy repo rate unchanged at 6.50 per cent in this meeting,” the RBI said.
Moderating inflation
RBI Governor Shaktikanta Das said in a statement that inflation has seen a significant moderation from the highs of the summer of 2022.
However, he noted that the headline inflation has remained high and has seen considerable volatility, moving in a range of 4.3 per cent to 7.4 per cent during the current financial year.
“Recurring food price shocks could interrupt the ongoing disinflation process, with risks that it could lead to de-anchoring of inflation expectations and generalisation of price pressures,” said Das.
