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Understanding RBI's New Credit Card Payment Rules: Mandatory BBPS for Bill Payments

The RBI credit card regulations aim to reduce frauds, enhance transparency, and understand payment patterns in a better way.

Understanding RBIs New Credit Card Payment Rules: Mandatory BBPS for Bill Payments
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Starting July 1, 2024, customers with credit cards from some of the major banks will not be able to use apps like PhonePe, Amazon Pay, and Paytm to pay their credit card bills as these apps aren't connected to the Bharat Bill Payment System (BBPS) managed by NPCI Bharat Bill Pay Limited (NBBL).

So, customers will have to use other ways or the banks' own platforms to pay their bills.

What is BBPS integration

BBPS is a system mandated by the Reserve Bank of India (RBI) to offer secure and reliable bill payment services to customers across geographies. The RBI credit card regulations aim to reduce frauds, enhance transparency, and understand payment patterns in a better way.

RBI credit card rules and Its Impact

The RBI has ordered that from July 1, 2024, all credit card payments must go through BBPS. This affects how credit card bills are handled in India, causing concerns for fintech companies like PhonePe, Cred, and BillDesk.

At present, credit cardholders have three payment options: auto-debit, netbanking (NEFT or IMPS), and third-party apps, with the latter ending on June 30, 2024.

Current integration status

As of July 3, 2024, some banks like AU Small Finance Bank, Bank of Baroda, and ICICI Bank are already using BBPS for credit card payments. Others, like Axis Bank and HDFC Bank, are still working on integrating with BBPS.

Despite its benefits, only a few banks have fully adopted it, causing uncertainty for users who rely on third-party apps for bill payments. The delay in integration may be due to the investment needed and concerns over data control.

The RBI credit card payment rule has greatly impacted customers who prefer using fintech payment platforms for making their payments. They are now scouting for other modes of payment options for clearing their dues.

Divya Shivaji
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