(MENAFN- Live Mint) Come July 1, credit card holders of major banks including HDFC Bank, ICICI bank and Axis Bank will not be able to pay their bills through third party apps such as CRED, PhonePe, Amazon Pay and Paytm as they are not yet live on the BBPS (Bharat Bill Payment System) platform of the NPCI (National Payments Corporation of India).
But if you hold a credit card issued by SBI, Bank of Baroda, Kotak Mahindra Bank, IndusInd Bank, federal Bank, Canara Bank, RBL Bank and AU Small Finance Bank there is no need to worry. These banks live on the BBPS platform and so customers can continue to make payments through third party apps.
Also Read | How does regular credit card usage affect your credit score over time?
The RBI (Reserve Bank of India) has made it mandatory to route all credit card bill payments by third party apps through NPCI's BBPS from July 1. Though apps such as CRED and PhonePe are members of BBPS, major credit card issuers such as HDFC, ICICI and Axis Bank are not yet live on the BBPS platform to receive credit card bill payments.
In fact, among the 34 banks that have been authorised to issue credit cards, 26 are yet to become active on BBPS.
Also Read | 5 key measures that can help mitigate the risk of credit card fraud
Credit card users of major banks, however, will be able to make payments through the websites of the issuing banks, netbanking and by using the apps of banks.“This is a temporary issue. In a few months, all banks will activate BBPS to accept credit card bill payments through third party apps,” according to experts who track credit cards.
Payments Council of India (PCI), the payments industry body, has requested RBI to extend the deadline for BBPS compliance by 90 days to avoid any disruption in services. HDFC Bank, ICICI Bank and Axis Bank alone have issued a total of more than 50 million credit cards in the country.
Also Read | Credit card consolidation: How to effectively pay off debt?
“I hope RBI extends the deadline so that bills are not affected. All banks should activate BBPS,” a user posted on X (formerly Twitter). RBI has taken the initiative as it wants all bill payments to be centralised. This would give it a clear picture about payment trends and would also allow it to track and control fraud .
Unlike regular credit card transactions, in the case of payments made through third parties, it is apps such as CRED that settles the amount to the bank through NEFT/IMPS or a direct transfer. The RBI is not comfortable with the idea as it is not done through a centralised platform, according to experts.
“Technically there is no challenge. But the RBI (government) wants to track everything and control for tax purposes,” another user said on X.
Incidentally, the RBI had clamped down P2P (peer-to-peer) credit card payments made via third party apps recently. The move came after the central bank found instances where customers used their credit cards to pay rents and tuition fees through third party apps.
Allirajan M is a journalist with over two decades of experience. He has worked with several leading media organisations in the country and has been writing on mutual funds for nearly 16 years.
MENAFN29062024007365015876ID1108387412
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.