The Bharat Bill Payment System (BBPS) is an integrated bill payment system in India that offers interoperable and accessible bill payment services to customers through a network of agents of registered members known as Agent Institutions (AI). It enables multiple payment modes and provides instant confirmation of payment.
Role of National Payments Corporation of India (NPCI)
- NPCI functions as the authorized Bharat Bill Payment Central Unit (BBPCU), responsible for setting business standards, rules, and procedures for technical and business requirements for all the participants.
- As the BBPCU, NPCI also undertakes clearing and settlement activities related to transactions routed through BBPS.
Payment Modes and Integration
- Existing bill aggregators and banks serve as Operating Units to provide an interoperable bill payment system, irrespective of which unit has onboarded a particular biller.
- Payments can be made through the BBPS using cash, transfer cheques, and electronic modes. BBPS has also been integrated with the Unified Payments Interface (UPI) for instant payments through UPI-enabled smartphones.
Implementation and Impact
- A committee headed by RBI Executive Director G. Padmanabhan was set up in 2013 to study the feasibility of implementation of Giro-based Payment Systems. It estimated that over 30,800 million bills amounting to ₹6223 billion are generated each year in the top 20 cities in the country.
- BBPS was developed to offer an efficient, cost-effective alternative to existing systems and enhance consumer confidence and experience.
Recent Developments
- On August 6, 2022, the Reserve Bank of India (RBI) allowed BBPS cross-border inward billing facility for Non-resident Indians, enabling NRIs to directly pay utility bills, education fees, municipal tax, and insurance-related payments without the need to send money first to a resident Indian bank account. The facility became active from September 13, 2022.
- On September 20, RBI governor Shaktikanta Das officially launched Bharat BillPay Cross-Border Bill Payments at Global Fintech Fest 2022.
- On January 4, 2022, NPCI launched the Unified Presentment Management System (UPMS) for recurring payments, allowing customers to set up standing instructions for any mode of payment, enabling auto-debit and bill payment management for transactions such as mutual funds, insurance, subscriptions, and school fee payments.