Despite the RBI’s June 30 deadline for the Bharat Bill Payment System (BBPS), certain users retain the ability to pay their credit card bills via third-party platforms such as Cred and PhonePe. These fintech providers are enabling credit card bill settlements for banks that have not yet complied with BBPS regulations using alternative channels like IMPS, NEFT, and UPI. However, industry sources indicate that Paytm is not facilitating such transactions.
The Reserve Bank of India mandated that all credit card payments must transition to the centralised Bharat Bill Payment System (BBPS) by June 30. Industry sources report that fintech platforms like Cred and PhonePe are employing alternative methods such as IMPS, NEFT, and UPI to process payments for non-compliant banks like HDFC Bank and Axis Bank, according to News 18.
Meanwhile, for banks compliant with BBPS like SBI and Kotak Mahindra Bank, these platforms are using the centralized billing network to route payments.
According to News 18, HDFC Bank and Axis Bank, among other major banks, have not activated BBPS.
Today, ICICI Bank activated BBPS, increasing the total number of banks that have implemented BBPS to 12.
“Lenders are all getting on board pretty fast,” said an industry player.
Banks that have activated BBPS include SBI Card, BoB Card, IndusInd Bank, Federal Bank, and Kotak Mahindra Bank.
“The reports that customers would not be able to make payments through fintech platforms like Cred after June 30 are completely untrue. Users can still make credit card bill payments for any bank. It is business as usual. For those lenders who have not complied with the BBPS directive, third-party apps are using alternative methods like IMPS, NEFT, and UPI. However, the fintech companies are using BBPS for those lenders who have already activated it,” an industry player explained.
Cred and PhonePe are enabling credit card payments for banks that have not complied with regulations, but Paytm does not support this. “From July 1, 2024, we support credit card bill payments only for banks registered on the Bharat Bill Payment System (BBPS). We will update you once this bank is supported,” read a pop-up on Paytm while attempting to pay an HDFC Bank credit card bill on July 1.
Credit Card Bill Payments Via Third-Party Apps: User Experience
Today, a user made a payment for their HDFC credit card bill using Cred. As HDFC Bank has not yet implemented BBPS, the payment was processed through IMPS, News 18 said. The SMS received by the HDFC Bank credit card user after the bill payment read: “DEAR HDFCBANK CARDMEMBER, PAYMENT OF Rs. XXX RECEIVED TOWARDS YOUR CREDIT CARD ENDING XXXX THROUGH IMPS ON 1-7-2024. YOUR AVAILABLE LIMIT IS RS. XXXXXX.”
Another payment made by an SBI credit card user via Cred read: “We have received payment of Rs.7,328.00 via BBPS & the same has been credited to your SBI Credit Card.”
Why Has RBI Mandated Centralised Payment of Credit Cards?
According to industry sources, the RBI’s objective with the centralised payment system is to enhance monitoring of payment trends and strengthen capabilities in detecting and addressing fraudulent transactions.