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Building a regulatory-compliant mandate management system for Cashfree

Updated: Feb 29

Cashfree is a payment gateway company enabling 300,000+ growing businesses in India and across the globe to collect payments, and also manages international payments for businesses. When the RBI issued new rules around the auto-debit feature offered by many banks to their customers, Cashfree had to put a Mandate Management System in place that complied with the guidelines. 

A Mandate Management System is a service that mediates the process of creation, amendment, and cancellation of mandates. A mandate is a standing signatory to a bank to debit a client's account periodically, for which the creation of a new mandate takes place in favor of the institution the user is opting for. The mandate management system can be incorporated with other systems and enhances the database whenever a user makes a purchase call from vendors listed on this company.

API-based mandates are those that are via the web and require the customer to authenticate their credentials digitally. When a customer submits a request through the merchant site, the application performance interface redirects the browser to the destination bank for authentication via the company's mandate management system.

Reconciliation software centralizes and automates the financial close process for businesses. To quickly reconcile accounts, the software pulls data from the general ledger and compares it to bank statements and customers’ financial data. The work of this company reconciliation software is to notify the mandate created on each call to users by displaying the debit notification and financial reconciliation on their interfaces. The most recent RBI guidelines of October 1st 2021 required card-issuing banks to send a pre-debit message to alert customers 24 hours before the payment due date.

The changes implemented by 91social resulted in major performance and cost advantages at the same time:

  • A regulation-compliant mandate management system was built in less than 2 months.

  • Payment reconciliation systems that could support a transaction volume of INR 50 crores per day were put in place.

  • A configurable bank-onboarding solution that could onboard a banking partner instantaneously was set up, through which 150k+ merchants were onboarded.

  • 200 million + accounts were served with payouts.



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