Four banks may log in to NBBL's 'interoperable netbanking' in October

At least four banks — HDFC Bank, Axis Bank, State Bank of India (SBI), and AU Small Finance Bank — along with several online payment aggregators are expected to go live next month on a new system for interoperable netbanking transactions. The platform is being developed and piloted by NPCI Bharat BillPay (NBBL).

 

Reserve Bank of India (RBI) Governor Sanjay Malhotra is expected to launch the new netbanking switch at the Global Fintech Fest 2025, scheduled for October 7–9. The system, called Netbanking 2.0, aims to standardise and simplify the transaction experience for online merchants accepting netbanking payments.

 

“We have to connect with  the core banking systems of multiple banks to enable netbanking as a payment method. Now, we will also have the option of connecting with the new netbanking solution being developed by NBBL as a backup,” said an executive at an online payment aggregator firm said who did not wish to be named.

 

While Axis Bank, AU Small Finance Bank, and NBBL declined to comment, HDFC Bank did not respond to an email query. SBI could not be reached immediately. 

 

NBBL, a subsidiary of the National Payments Corporation of India (NPCI), which operates the Unified Payments Interface (UPI), also runs the Bharat Connect bill payment system.

 

Sources said the new system would not rely on existing payment rails but would function as an entirely new switch.

India has over 50 fully licensed online payment aggregators, and the large number of players makes it difficult for banks to integrate with each one, another source familiar with the matter noted.

 

The new system differs from the current setup as it will enable interoperability of netbanking transactions once multiple banks come aboard a single platform. For instance, currently online payment aggregators like Razorpay, Cashfree Payments, CCAvenue and BillDesk have to partner with each bank separately to ensure netbanking solutions are available to their merchants — those like travel booking websites, ecommerce platforms and digital fashion portals — for payment acceptance.

 

Users cannot use netbanking as a payment method if the online payment aggregator tied to a merchant lacks an arrangement with the user’s remitter bank.

 

Other challenges include a lack of standardisation, limited visibility across categories, and issues with chargebacks, settlements, and reconciliations, Business Standard reported in April. The new switch is expected to address many of these concerns by standardising processes.

 

In 2024, the RBI had approved the implementation of interoperability for netbanking transactions aimed at addressing delays in the actual receipt of payments by merchants.

Easy banking 

• System to enable interoperability in netbanking
• New switch to standardise complex backend processes
• Built by NBBL, an NPCI subsidiary
• Official launch likely  at Global Fintech  Fest 2025