We occasionally want to purchase items from foreign websites. The factors may range from the availability to the cost of the goods we intend to purchase. However, these foreign websites and their payment gateways occasionally are unable to handle payments made with debit or credit cards issued in India. There could be a variety of causes for this.

Your card may not support international transactions, which is the biggest and most obvious reason. International transactions are not supported by all debit/credit cards. To find out if your card can be used for international transactions, contact your bank or the card's issuance company.

In order for the cards that support international transactions to function on foreign websites, account holders must also enable international transactions. On an international website, cardholders can set a limit for the largest transaction amount they wish to make. If the amount you are spending exceeds the same, the transaction will not go through.

What RBI rules say

In October 2021, the Reserve Bank of India (RBI) issued a clear directive regarding international payment websites and auto-debit regulations when using Indian debit or credit cards. An international website cannot accept recurring or one-time payments from Indian debit or credit cards if it does not adhere to the RBI's rules. Furthermore, the international website may occasionally not even be to blame for a payment failure.

According to Pranay Jhaveri, MD for India and South Asia at payment service provider Euronet, "There are a number of factors that could be the cause of this. There might be geographical restrictions or restrictions on the nations which certain international websites will accept payments from. Due to restrictions on both currency and commerce, Indian credit cards could be denied access to such websites.

There might be additional factors. The Foreign Exchange Management Act of 1999's Schedule 1 and the RBI's Master Circular on Miscellaneous Remittances from India - Facilities for Residents state that Indian credit and debit cards cannot be used to send money to countries where doing so would be illegal under other laws. According to Pallav Pradyumn Narang, Partner at CNK, a chartered accounting firm with offices in Delhi, these prohibited categories include payments for lottery tickets, online gambling, the purchase of prohibited substances, as well as magazines and websites that are prohibited or outlawed.

OTP failure and more

Additionally, even if a foreign website complies with all Indian payment laws and regulations and is not on the RBI's exclusion list, it might occasionally not be able to accept payments from Indian debit and credit cards. The causes in these situations can range from OTP issues to network or other authentication problems.

Another scenario is one in which the payee bank deems the transaction suspicious and refuses to permit payment to proceed. This might even occur when the website you want to use for the transaction uses a shoddy security protocol. There are also instances where a payment is accepted on a foreign website but is later reversed, resulting in the failure of the transaction.