Fintech companies such as PhonePe, Cred, BillDesk, and Infibeam Avenues are among those that will be affected by the latest regulation from the RBI, which mandates that credit card bill payments be routed through the RBI's centralised billing network. The regulation will go into effect on July 1.
Axis Bank, HDFC Bank, and ICICI Bank have not yet enabled BBPS. Customers have received credit cards from these banks totaling more than 5 crore cards.
Prior to June 30, the Reserve Bank of India mandated that all credit card payments be made via the Bharat Bill Payment System (BBPS).
Fintech companies like PhonePe and Cred, who are already members of BBPS, will also be unable to handle payments on credit card dues on their behalf after June 30 due to these lenders' unfulfilled compliance with the directives.
Industry Sought an extension
For these fintechs to run smoothly, lenders must adhere to RBI regulations through June 30. According to the report, the CEO of a major payments company stated, "The payments industry has sought an extension of the deadline by 90 days."
"Out of the 34 banks that are authorized to issue credit cards, only eight banks have enabled bill payments on BBPS as of right now, according to the report.
The following lenders have enabled BBPS: Federal Bank, Kotak Mahindra, IndusInd Bank, SBI Card, and BoB Card.
Why is the RBI requiring credit card payments to be centralized?
Industry participants stated that in addition to helping the RBI identify and stop fraudulent transactions, it also intends to give the central bank greater insight into payment patterns.
