Final Guidelines for Bharat Bill Payment System Issued By RBI
Final Guidelines for Bharat Bill Payment System Issued By RBI
The RBI released the final guidelines for the implementation of the Bharat Bill Payment System/BBPS. This system will enable consumers to pay numerous bills including electricity, telephone and school fees at one single point of transaction only. The final guidelines were issued for the system on 28th November 2014.
Integrated Bill Payment System
The Bharat Bill Payment System is an integrated bill payment system offering interoperable as well as easy bill payment option to consumers via a network of agents ensuring convenience through multiple payment modes as well as instant payment confirmation.
The National Payment Corporation of India/NPCI will function in the form of an authorised Bharat Bill Payment Central Unit/BBPCU for setting standards for BBPS processes that may be adhered to by all operating units. These units will be known as Bharat Bill Payment Operating Units or BBPOUs.
Those interested in participating in the BBPS system must interact with the NPCI for working out the modalities. The central Indian bank has established the qualifying conditions for authorised collection agents to be as follows:
• Domestic registration
• 100 crore rupees net worth
NPCI, as well as the BBPCU, will also set about clearing and settlement activities pertaining to the BBPS as outlined in the guidelines. The participants of the BBPS system must interact with the NPCI for working out the modalities. Prospective BBPOUs must submit applications for authorisation under the Payment & Settlements Systems Act, 2007 to the RBI from the first quarter of 2015. Notification for when the applications can be submitted for approval is forthcoming.
Detailed Background to the Integrated Bill Payment System
The Payment Systems Vision in India 2012 to 2015 showed the prevalence of a massive bill payments market with a complex, diverse biller market structure and numerous region/national players and private or public owned entities. As per the Second Quarter Review of the Monetary Policy 2012-2013, the RBI announced the establishment of the Committee for finalising the set up of an electronic GIRO payment system in India.
The Committee was chaired by Shri G. Padmanabhan who is the ED at the RBI for studying the feasibility of implementation of the electronic GIRO payment system in the nation. A Giro advisory group was firmed under the chairmanship of Prof, Bellur from IIT-Bombay with the objective of creating pan India touch points for bill payment across the nation.
The Committee submitted the report on March 20 this year. It recommended that a tiered structure bill payment system be established in the country with a central regulatory unit. The Draft Guidelines for the implementation of the Bharat Bill Payment System on August 7, 2014 for public comments. The final guidelines were formed on the basis of public comments to the draft guidelines.
As per the guidelines, the BPPS or Bharat Bill Payment System will operate as a tiered structure for management of bill payment systems anywhere in the nation with a single brand image and a ease of anytime anywhere bill payment as regards the system. The BBPS will consist of the Bharat Bill Payment Central Unit which is the authorised entity for operating the BBPS. BBPOUs will be the authorised operational units working in terms of standards set by the BBPCU.
Scope of the Bill Payment System
The BPPS will be implemented to provide service to customers via a network of agents for numerous payment modes and instant confirmation of payment. Both banks and non banks as well as aggregation of payment services will be part of BBPS. To start with, this system will include activities for the facilitation of collection of repetitive payments for services provided by utility companies. The scope of this payment system may soon extend to include services involving school university fees, municipal taxes, payments and more as decided by the RBI.
