BBPS-credit card activation: Banks expect 3-4 weeks' leeway for integration

IBA liaising with regulator; issuers put in place systems to go live on BBPS

Major credit card-issuing banks that have not yet integrated themselves with the Bharat Bill Payment System (BBPS) platform for receiving credit card repayment via third-party applications are anticipating a breathing space of three-four weeks from the Reserve Bank of India (RBI) to complete the activation process, according to sources aware of the development.

The Indian Banks’ Association (IBA) is liaising with the RBI on the matter, sources said, adding banks had put in place systems to go live on the BBPS and the process of taking on board all the banks would be completed in a few weeks.
 

An email sent to the RBI and IBA did not elicit a response till the time of going to press.

 

The RBI had mandated that payment by the credit card should be processed through the BBPS, starting July 1. However, a few major credit card issuers have not yet integrated their systems on schedule, causing confusion among users.
 

Industry insiders suggest there has not been widespread disruption because users have multiple options to settle their dues.

Currently, third-party appl­i­c­ations like Cred, Paytm, PhonePe, or Amazon Pay 
 

utilise national electronic fund transfer, real-time gross settlement, or other payment methods to transfer funds to credit card issuers after users clear their bills on their platforms.
 

Once all credit card issuers and third-party applications integrate their systems with the BBPS platform, these apps will settle payments with banks via the BBPS platform.
 

Business Standard had reported certain third-party applications had opted to facilitate credit card bill payments exclusively for banks integrated into the BBPS starting from July 1, out of concern for compliance with the RBI’s mandate. 
 

For instance, to stay in line with the RBI’s guidelines, Paytm has decided to process credit card transactions for only those banks that have gone live on BBPS. 
 

According to the BBPS website, HDFC Bank, Axis Bank, IDFC Bank, YES Bank, Indian Bank, and Indian Overseas Bank are yet to go live on the platform while Kotak Mahindra Bank, ICICI Bank, Punjab National Bank, Federal Bank, IndusInd Bank, and few others are there.  Industry participants said some fintechs might process credit card transactions for banks that have not yet 

integrated with BBPS, though this can violate RBI norms.

Previously, the payments industry had requested a 90-day extension for banks to complete BBPS integration. Fintech players affected by these developments were anticipating leniency in regulation.