While banks complained of faulty implementation, telecom industry sources said banks had not created a proper template for their text messages despite repeated communication
Responding to the outages felt across banking and e-commerce services, the Telecom Regulatory Authority of India (Trai) has put on hold implementation of its regulations to curb unsolicited commercial communication. Users failed to receive text messages including one time passwords for online transactions , and banks attributed the glitches to Trai’s new regulations which came into effect on Monday.
The regulator has now given service providers another week to adhere to the norms, though banks and payment gateway firms said on Tuesday that 60-70 per cent of their messages were delivered to customers.
regulations were introduced in 2018 and a framework was put in place to protect customers from fraud and phishing. Under these regulations, companies which send messages are registered and the messages are verified by telecom companies
using a block chain-based solution. Text messages from unregistered sender IDs or headers are blocked.
While banks complained of faulty implementation, telecom industry sources said banks had not created a proper template for their text messages despite repeated communication.
On Tuesday, regulators stepped in to ease the stress.
Even as Trai
put the regulation on hold, the Reserve Bank of India is examining the matter as well, it is learnt. "Besides monetary penalty, there would also be reputational consequences for banks," a public sector banker said.
In a statement, Trai
said, “It has been observed some of the principal entities have not fulfilled the requirements as envisaged in Telecom Commercial Communications Customer Preference Regulations, 2018. As a result, their SMSes were getting dropped after implementation of the scrubbing of SMSes by telecom service providers. In order to protect the interest of consumers, it has been decided that the scrubbing of SMSes by TSPs shall be suspended temporarily for seven days.” It added that a week’s time is being given to enable principle entities to register the template of their text messages so that customers don’t face further inconvenience.
Scrubbing refers to a verification process followed by telecom companies
for sending text messages.
According to an executive of the Indian Banking Association (IBA), most banks have registered with telecom companies
and submitted their templates for sending commercial messages to customers. "Banks are supposed to stick to templates. But what happened was that there was some difference in templates shared with telecom companies and text messages banks wanted to send to their customers. As a result, messages are not being delivered as they are not according to the approved templates. So it’s a technical glitch and most bankers are working on it (like customization of template). Now everybody will conform with the template," he said.
Pointing out that the situation was better now, the official explained that when the regulations came into effect Monday morning, many SMS providers and banks did not have their templates registered. Also, because of messages getting stuck, the network clogged up. On Monday, the success rate of sending SMSes was at zero for some
Ratan Kesh, EVP & Head-Retail Operations & Service, Axis Bank, said, "The industry is working with several communication aggregators to get this in action smoothly. Some of the aggregators serving the industry were not prepared, resulting in disruption in the early hours on Monday.’’
"We faced some intermittent issues related to OTP-based transactions yesterday. They got resolved and we are back to near normal today," said sources close to HDFC Bank.
Executives from payment security firms said the implementation could have been better managed.
Suresh Rajagopalan, CEO, Wibmo Inc, a digital payments
and payment security firm, said that once registration was done by payment service providers (PSPs), time-sensitive alerts should have been validated with banks again through test transactions. Such a validation would have helped in matching the content and spotting anomalies, he explained.