The Reserve Bank of India (RBI) has introduced a new framework called the Bharat Bill Payment Systems Directions, 2024, to simplify and make the system of bill payments more seamless and enhance customer protection. The fresh directive is applicable to NPCI Bharat Bill Pay Limited (NBBL), a wholly owned subsidiary of National Payments Corporation of India (NPCI), and all Bharat Bill Payment Operating Units (BBPOUs).
What is Bharat Bill Payment System (BBPS)?
BBPS is an integrated bill payment system that offers interoperable and accessible bill payment service to customers through a network of agents, enabling multiple payment modes, and providing instant confirmation of payment. BBPS covers various categories of bills such as electricity, water, gas, telecom, DTH, education fees, insurance premiums, etc. BBPS aims to provide a convenient, secure, and reliable platform for customers to pay their bills anytime, anywhere.
What are the new directions in BBPS ?
The new directions seek to streamline the process of bill payments, enable greater participation, and enhance customer protection among other changes. The directions were issued on February 29 and will come into effect from April 1, 2024. Some of the key features of the new directions are:
- NBBL is the entity authorised as the Payment System Provider for BBPS. NBBL will act as the central unit that will oversee the functioning of BBPS and ensure compliance with the RBI directions.
- Any entity, other than a biller, operating a system for payment of bills outside the scope of BBPS is a ‘payment system’ under Section 2 (1) (i) of PSS Act 2007 and will require authorisation as per Chapter III of the Act to undertake the activity. This will ensure that only authorised entities can offer bill payment services to customers.
- The directions clearly spell out the roles and responsibilities of the system operator and system participants. The system operator is NBBL, which will provide technical infrastructure and operational support for BBPS. The system participants are BBPOUs, which are entities that offer bill payment services to customers or billers through various channels such as websites, apps, kiosks, etc.
- NBBL will provide guaranteed settlement of all transactions routed through BBPS and ensure that all transactions have BBPS reference number from the payment initiation stage. This will ensure timely and accurate settlement of funds among the participants and reduce the risk of disputes or errors.
- The Biller Operating Unit (BOU) will have to ensure compliance to due diligence requirements in respect of onboarding of merchants. The BOU will be responsible for verifying the credentials and authenticity of the billers before allowing them to join BBPS. The BOU will also have to ensure that the billers provide accurate and updated information about their bills and charges to customers.
- The Customer Operating Unit (COU) will provide digital/physical interface to their customers, directly or through agent institutions, ensuring customers have access to all billers onboarded on BBPS, provide a system for raising disputes, and taking responsibility for the activities of its agent institutions. The COU will be responsible for providing a user-friendly and secure interface for customers to pay their bills through various modes such as cards, wallets, UPI, etc. The COU will also have to ensure that customers receive instant confirmation of payment through SMS or email. The COU will also have to provide a mechanism for customers to raise disputes or complaints in case of any issues with their bill payments.
- A non-bank BBPOU shall open an escrow account with a Scheduled Commercial Bank exclusively for BBPS transactions. The escrow account will be used for holding funds collected from customers or settled with billers on behalf of BBPOUs. The escrow account will ensure that there is no diversion or misuse of funds by the BBPOUs.
- The master direction spells out clearly the need for a Complaint Management and Grievance Redressal system. It lists the following steps:
- Customers can raise disputes or complaints with their respective COUs within 30 days from the date of transaction.
- COUs shall resolve disputes or complaints within 15 days from the date of receipt.
- If customers are not satisfied with the resolution provided by COUs, they can escalate their disputes or complaints to NBBL within 30 days from the date of resolution provided by COUs.
- NBBL shall resolve escalated disputes or complaints within 15 days from the date of receipt.
- If customers are not satisfied with the resolution provided by NBBL, they can approach the Banking Ombudsman or the Ombudsman for Digital Transactions, as applicable, within one year from the date of resolution provided by NBBL.
How will customers benefit?
The new directions are expected to bring more efficiency, transparency, and security in the bill payment system. Customers will have more options to pay their bills through various modes such as cards, wallets, UPI, etc. Customers will also have more protection in case of disputes or complaints. Customers will be able to access all billers onboarded on BBPS through any COU or agent institution. Customers will also get instant confirmation of payment through SMS or email. Customers will also have the option to escalate their disputes or complaints to NBBL or the Ombudsman, if they are not satisfied with the resolution provided by COUs.
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