Bharat Bill Payments System

With the increase in e-commerce sites in India, people also like to buy products online and pay for them online only through debit cards, credit cards, netbanking and some platforms. Under the retail payment transactions, bill payments like electricity, water, phone bills, etc. also form a major component.
With a need of bill payments system, various organizations decided to provide a single platform to make all these payments. So an integrated bill payment system called Bharat Bill Payment System (BBPS) was proposed for which the policy guidelines were issued by the Reserve Bank of India on November 28, 2014.

The Committee headed by RBI Executive Director G. Padmanabhan was set up in 2013 to study the feasibility of implementation of Giro based Payment Systems.

• Giro: A giro or giro transfer, is a payment transfer from one bank account to another bank account and initiated by the payer, not the payee.

National Payment Corporation of India (NPCI) had been identified to act as Bharat Bill Payment Central Unit (BBPCU) which will be a single authorized entity for operating the BBPS. The BBPCU will set necessary operational, technical and business standards for the entire system and its participants, and also undertake clearing and settlement activities. It will work only as a medium to connect multiple billers and agents through various Operating Units. BBPCU will be responsible for setting business standards, rules, and procedures for technical and business requirements for all participants.

BBPS will operate on entities called Bharat Bill Payments Operating Unit (BBPOU). BBPOU will be authorised operational entities, which can fulfill the standards set by the BBPCU for facilitating bill payments online as well as through a network of agents, on the ground. Banks and non-bank entities presently engaged in any of the above bill payment activities falling under the scope of BBPS can apply for approval from RBI under the Payment and Settlement Systems (PSS) Act 2007.

Some facts about BBPS:

• The biggest advantage is that the bill can be paid anywhere and anytime.
• The system will provide multiple payment modes and instant confirmation of payment.
• Payments may be made through the BBPS using cash, transfer cheques, and electronic modes.
• Retail points will be set up for bill payments across the country who would be able to accept all kinds of bills payments made through credit cards, debit cards, mobile wallets, net banking (IMPS, NEFT).
• The BBPS outlets would include banks, ATMs, business correspondents, kiosks etc.
•  Payments would be made securely through the NPCI network with instant receipts getting generated.
• PayU India is the first non-bank entity which got RBI approval to set up and operate Bharat Bill Payment System (BBPS).
• The Bharat Bill Payment System (BBPS) will function as a tiered structure for operating the bill payment system in the country under a single brand image