wordpress blog stats
Connect with us

Hi, what are you looking for?

Netflix is violating RBI’s two-factor authentication and forex rules for payments

netflix (1)

My bank called me when I tried to sign up for Netflix. I use a HDFC Bank debit card and had not set limits on for international payments. Netflix did mention that payments will be processed internationally and that foreign transaction fees apply.

netflix 2FA 2

I entered my card details, which included my card number and CVV code, a few minutes after my bank set my limits. However, Netflix seems to be violating the Reserve Bank of India’s guidelines for card not present transactions which mandates that there should be two-factor authentication for card payments online and that settlement of transactions should be made by an Indian bank.

I did not receive an one-time password on my phone and Netflix redirected me to this page which said that the payment was successful.

Netflix 2FA 1

I also received a message on my phone that the payment was processed by Netflix in Amsterdam. Curiously, HDFC Bank’s representative who called me said that the payment to Netflix is being routed to a merchant in Singapore.

netflix 2fa 3

Users on Twitter had also spotted that Netflix was bypassing two-factor authentication.

Advertisement. Scroll to continue reading.

Previously, the RBI had mandated that entities that route online billing internationally, for goods and services purchased online using Indian cards, need to include a second factor of authentication, and route transactions through a bank in India.

Uber’s problems with two-factor authentication

Readers will remember that cab hailing service Uber had run into similar problems in 2014 and had to comply with RBI’s guidelines on card-not-present transactions and to tie up with mobile wallet Paytm to facilitate transactions in India. Uber has since resumed payments via cards in July 2015 and tied up with Delhi-based Zaakpay, a digital payments gateway, to enter a CVV  and a one-time password received on their mobile phone to pay for the cab ride.

MediaNama’s take

We’ve pointed out earlier that there is a lot of confusion on the nature of RBI’s two-factor authentication and foreign exchange rules. It is unclear whether these rules impact purchases only made in India, or they impact all purchases made using Indian cards in India (in which case, all transactions using Indian cards will have to be in INR). Many users have pointed out that purchases made on Amazon.com, gaming marketplace Steam and other international websites do not go through two-factor authentication and it remains to be seen how the RBI will handle this situation. Netflix should have done its homework on this front and taken lessons from Uber on how to enter the Indian market.

Advertisement. Scroll to continue reading.

Image by Matt Perreault, used under CC-BY-SA.

Written By

MediaNama’s mission is to help build a digital ecosystem which is open, fair, global and competitive.

Views

News

The DSCI's guidelines are patient-centric and act as a data privacy roadmap for healthcare service providers.

News

In this excerpt from the book, the authors focus on personal data and autocracies. One in particular – Russia.  Autocracies always prioritize information control...

News

By Jai Vipra, Senior Resident Fellow at Vidhi Centre for Legal Policy The use of new technology, including facial recognition technology (FRT) by police...

News

By Stella Joseph, Prakhil Mishra, and Yash Desai The Government of India circulated proposed amendments to the Consumer Protection (E-Commerce) Rules, 2020 (“E-Commerce Rules”) which...

News

By Rahul Rai and Shruti Aji Murali A little less than a year since their release, the Consumer Protection (E-commerce) Rules, 2020 is being amended....

You May Also Like

News

Rajesh Kumar* doesn’t have many enemies in life. But, Uber, for which he drives a cab everyday, is starting to look like one, he...

News

By Aroon Deep and Aditya Chunduru You’re reading it here first: Twitter has complied with government requests to censor 52 tweets that mostly criticised...

Advert

135 job openings in over 60 companies are listed at our free Digital and Mobile Job Board: If you’re looking for a job, or...

News

Google has released a Google Travel Trends Report which states that branded budget hotel search queries grew 179% year over year (YOY) in India, in...

MediaNama is the premier source of information and analysis on Technology Policy in India. More about MediaNama, and contact information, here.

© 2008-2021 Mixed Bag Media Pvt. Ltd. Developed By PixelVJ

Subscribe to our daily newsletter
Name:*
Your email address:*
*
Please enter all required fields Click to hide
Correct invalid entries Click to hide

© 2008-2021 Mixed Bag Media Pvt. Ltd. Developed By PixelVJ