Executive Summary:
The Reserve Bank of India (RBI) issues the Bharat Bill Payment System (BBPS) Directions, 2024, to update and streamline the existing regulatory framework for bill payments. These directions aim to enable greater participation, enhance customer protection, and improve the bill payment process. The new directions, issued under the Payment and Settlement Systems (PSS) Act, 2007, will be effective from April 1, 2024, and supersede previous BBPS guidelines.
Key Points / Main Content:
Applicability:
* The directions apply to NPCI Bharat Bill Pay Limited (NBBL) and all Bharat Bill Payment Operating Units (BBPOUs).
Authorisation:
* NBBL is the authorized Payment System Provider for BBPS.
* Entities operating bill payment systems outside the scope of BBPS require authorization under the PSS Act, 2007.
Definitions:
* Key terms defined include Agent Institution, Bharat Bill Pay Central Unit (BBPCU), Bharat Bill Payment Operating Unit (BBPOU), Biller Operating Unit (BOU), Customer Operating Unit (COU), Bharat Bill Payment System (BBPS), Bill, Biller, Biller Aggregator, Sponsor bank, and Technology Service Providers (TSP).
Participants in BBPS:
* NBBL acts as the BBPCU, connecting customers and billers through COUs and BOUs, and handles clearing and settlement.
* Banks, non-bank Payment Aggregators (PAs), and authorized BBPOUs can participate as Operating Units. Banks and non-bank PAs operating as BBPOUs do not require separate authorization but must inform DPSS, RBI, Central Office before commencing operations.
Roles and Responsibilities:
* BBPCU: Sets rules, technical standards, ensures guaranteed settlement, BBPS reference numbers, no TSP fund flow, and consumer dispute redressal framework.
* BOU: Onboards billers, ensures due diligence as per Payment Aggregator guidelines, and manages billers onboarded through aggregators.
* COU: Provides customer interface, ensures access to all billers, provides dispute resolution system, and is responsible for agent institution activities.
Escrow Account Operations:
* Non-bank BBPOUs must open an escrow account with a Scheduled Commercial Bank for BBPS transactions.
* Payment system operated by BBPOU shall be deemed to be designated payment system under Section 23A of the PSS Act, 2007.
* Eligible credits and debits for COU and BOU escrow accounts are defined, including settlement, failed/disputed transactions, and charges/commissions.
* Escrow account operations must comply with the Guidelines on Regulation of Payment Aggregators and Payment Gateways.
Complaint Management and Grievance Redressal:
* NBBL must implement a dispute resolution framework compliant with RBI's Online Dispute Resolution (ODR) guidelines.
* COUs and BOUs must integrate with the centralized system for dispute resolution, using the BBPS reference number.
* Failed transactions must be handled according to RBI's TAT guidelines and customer compensation rules.
Supersession of Earlier Guidelines/Circulars:
* The Directions supersede specific circulars related to BBPS implementation, expansion of biller categories, and amendments to guidelines.
Impact Analysis:
NBBL Impact:
*Impact: NBBL's role as the central unit is reinforced, and it must ensure compliance with the new directions, including setting standards, managing settlement, and providing a dispute resolution framework.
*Action Required: Update systems and processes to align with the new directions, implement a dispute resolution framework, and ensure all participants are integrated.
BBPOUs (Banks, Non-bank PAs, and Other Authorized Entities) Impact:
*Impact: BBPOUs must adhere to the updated regulations, including escrow account requirements, dispute resolution processes, and due diligence for onboarding billers.
*Action Required: Review and update operational procedures to comply with the new directions, establish escrow accounts (if applicable), integrate with NBBL's dispute resolution system, and ensure compliance with due diligence requirements.
Billers Impact:
*Impact: Billers connected to BBPS through BOUs are indirectly affected, as the BOUs are responsible for ensuring their compliance with due diligence requirements.
*Action Required: Ensure they meet the due diligence requirements set by BOUs and NBBL, and participate in the dispute resolution framework when necessary.
Customers Impact:
*Impact: Customers are expected to benefit from enhanced protection, a streamlined bill payment process, and improved dispute resolution mechanisms.
*Action Required: Utilize the dispute resolution system provided by COUs and NBBL in case of failed transactions or other issues.
Agent Institutions Impact:
*Impact: Agent Institutions must adhere to the guidelines set by COUs, as COUs are responsible for their activities.
*Action Required: Ensure compliance with COU guidelines and participate in the dispute resolution framework as required.
Key Entities Referenced
Reserve Bank of India: The central bank of India, responsible for regulating the country's banking and financial system.
Bharat Bill Payment System: An integrated bill payment platform for online and offline bill payments.
Payment and Settlement Systems Act, 2007: An act of the Indian Parliament that provides for the regulation and supervision of payment systems in India.
NPCI Bharat BillPay Limited: A wholly-owned subsidiary of the National Payments Corporation of India (NPCI) and the Central Unit (BBPCU) operating the Bharat Bill Payment System (BBPS).
Bharat Bill Payment Operating Units: The system participants in Bharat Bill Payment System (BBPS).
Scheduled Commercial Banks: Banks in India that are listed in the Second Schedule to the Reserve Bank of India Act, 1934.
Urban Cooperative Banks: Primary cooperative banks operating in urban and semi-urban areas.
State Cooperative Banks: A cooperative bank in India.
भारतीय �रज़व र् बक�
RESERVE BANK OF INDIA
www.rbi.org.in
RBI/DPSS/2023-24/111
CO.DPSS.POLC.No.S1114/02-27-020/2023-2024 February 29, 2024
The Chairman / Managing Director / Chief Executive
All Scheduled Commercial Banks including RRBs /
Urban Cooperative Banks / State Cooperative Banks / District Central Cooperative Banks /
NPCI Bharat BillPay Limited / Non-bank Payment System Participants
Dear Sir / Madam,
Master Direction – Reserve Bank of India (Bharat Bill Payment System) Directions, 2024
The current regulations covering Bharat Bill Payment System (BBPS) (RBI Circular
DPSS.CO.PD.No.940/02.27.020/2014-15 dated November 28, 2014) provide for a tiered
structure with (a) NPCI Bharat Bill Pay Ltd (NBBL) as a Central Unit (BBPCU) (b) Bharat Bill
Payment Operating Units (BBPOUs) and (c) Agent network/s of the BBPOUs.
2. In view of significant developments in the payments landscape, a need was felt to review
and update these regulations. Accordingly, as announced in Statement on Developmental and
Regulatory Policies dated June 08, 2023, it has been decided to put in place a revised
regulatory framework - Bharat Bill Payment Systems Directions, 2024, as annexed hereto.
3. These Directions seek to streamline the process of bill payments, enable greater
participation, and enhance customer protection among other changes.
4. These Directions shall be applicable from April 01, 2024 and shall supersede the regulations
cited in para 1. This is issued under Section 18 read with Section 10(2) of the Payment and
Settlement Systems (PSS) Act, 2007 (Act 51 of 2007).
Yours faithfully,
(Gunveer Singh)
Chief General Manager-in-Charge
भुगतान और िनपटान �णाली िवभाग, क��ीय कायार्लय, 14वीमंिजल, क��ीयकायार्लयभवन,शहीदभगत�संहमाग,र् फोट,र् मुम्बई - 400001
फोनTel: (91-22) 2264 4995; फैक् सFax: (91-22) 22691557; ई-मेलe-mail : cgmdpssco@rbi.org.in
Department of Payment and Settlement Systems, Central Office, 14th Floor, Central Office Building, Shahid Bhagat Singh Road, Fort, Mumbai -
400001
�हदं ी आसान ह,ै इसका �योग बढ़ाइएCO.DPSS.POLC.No.S1114/02-27-020/2023-2024 dated February 29, 2024
Annex
Master Direction –
Reserve Bank of India (Bharat Bill Payment System) Directions, 2024
In exercise of the powers conferred under Section 18 read with Section 10(2) of the Payment
and Settlement Systems Act, 2007 (PSS Act), the Reserve Bank of India being satisfied that
it is necessary and expedient in the public interest to do so, hereby, issues the Directions
hereinafter specified.
1. Short Title and Commencement
a. These Directions shall be called the Reserve Bank of India (Bharat Bill Payment System)
Directions, 2024.
b. These Directions shall be applicable from April 01, 2024.
2. Applicability
The provisions of these Directions shall apply to:
a. NPCI Bharat Bill Pay Limited (NBBL - a wholly owned subsidiary of National Payments
Corporation of India); and
b. All Bharat Bill Payment Operating Units (BBPOUs).
3. Authorisation requirement
a. NBBL is the entity authorised as the Payment System Provider for Bharat Bill Payment
System (BBPS).
b. Any entity, other than a biller, operating a system for payment of bills outside the scope
of BBPS is a ‘payment system’ under Section 2(1)(i) of PSS Act 2007 and will require
authorisation as per Chapter III of the Act to undertake the activity.
4. Definitions
In these Directions, unless the context otherwise requires, the terms herein shall bear the
meanings assigned to them below:
a. Agent Institution: An entity, certified by NBBL, which provides customer interface
(physical / digital) for bill payments.
b. Bharat Bill Pay Central Unit (BBPCU): BBPCU is the entity which operates BBPS; sets
operational, technical and business standards, and also undertakes clearing and
settlement functions. NPCI Bharat BillPay Ltd. (NBBL) is the authorised BBPCU.c. Bharat Bill Payment Operating Unit (BBPOUs): BBPOUs are the System Participants
in BBPS. A BBPOU may function either as a Biller Operating Unit or a Customer Operating
Unit or both.
i. Biller Operating Unit (BOU) is an entity which onboards biller(s), either directly or
through biller aggregator(s), on to the BBPS platform for collection of its bills.
ii. Customer Operating Unit (COU) is an entity which provides its customers with an
interface (physical / digital) to pay bills, either directly or through agent institution(s).
d. Bharat Bill Payment System (BBPS): BBPS is an integrated bill payment platform which
enables payment / collection of bills through multiple channels (Mobile Apps, Mobile
Banking, Physical Agents, Bank branches, etc.) using various payment modes (UPI,
Internet Banking, Cards, Cash, Prepaid Payment Instruments, etc.). The transactions
facilitated through this platform will require the bill to be fetched before payment initiation.
In case of transactions involving payments for prepaid services, the customer relationship
with the biller will be validated through the platform.
e. Bill: Bill means any notice for payment raised by a biller for recurring or non-recurring
payments. Bill also includes notice or advice for recharge of prepaid services.
f. Biller: An entity (including Central and State Government Department / Public Sector
Undertaking / individuals) which is connected to BBPS through a BOU (either directly or
through a biller aggregator) for collection of bill payments.
g. Biller Aggregator: An entity which aggregates billers for the purpose of enabling them to
connect to a BOU.
h. Sponsor bank: A Scheduled Commercial Bank which facilitates settlement of non-bank
BBPOUs with NBBL.
i. Technology Service Providers (TSP): Entities certified by NBBL to provide technology
services and solutions to billers / BBPOUs / Agent Institutions to integrate with BBPS.
5. Participants in BBPS
a. Bharat Bill Pay Central Unit (BBPCU): NBBL as the BBPCU, provides a platform
connecting customers and billers, through COUs and BOUs, respectively. NBBL also
undertakes clearing and settlement activities for transactions routed through the BBPCU.
b. Bharat Bill Payment Operating Units (BBPOUs): Banks (All Scheduled Commercial
Banks including RRBs / Urban Cooperative Banks / State Cooperative Banks / DistrictCentral Cooperative Banks), non-bank Payment Aggregators (PAs)1 and other existing
entities authorised as BBPOUs can participate in BBPS as Operating Units. Banks and
non-bank PAs, intending to operate as BBPOUs, will not require a separate authorisation.
They shall intimate DPSS, RBI, Central Office before commencing operations.
6. Roles and Responsibilities
The indicative roles and responsibilities of the system operator and system participants are as
below:
a. Bharat Bill Pay Central Unit (BBPCU)
i. Setting the rules and regulations governing participation criteria and system
operations;
ii. Setting the technical standards for participation in the system;
iii. Providing guaranteed settlement of all transactions routed through NBBL;
iv. Ensuring that all transactions have BBPS reference number from the payment initiation
stage;
v. Ensuring no funds in the system flow through any TSP; and
vi. Providing a framework for redressal of consumer disputes.
b. Biller Operating Unit (BOU)
i. Onboarding billers to BBPS;
ii. Ensuring compliance to due diligence requirements in respect of onboarding of
merchants prescribed in Guidelines on Regulation of Payment Aggregators and
Payment Gateways dated March 17, 2020, as updated from time to time;
iii. Ensuring compliance to additional due diligence requirements which may be
prescribed by NBBL for specific biller categories; and
iv. Ensuring due diligence of the billers onboarded through biller aggregators.
c. Customer Operating Unit (COU)
i. Providing digital / physical interface to their customers, directly or through agent
institutions;
ii. Ensuring customers (including customers of their agent institutions) have access to all
billers onboarded on BBPS;
iii. Providing a system for raising disputes; and
iv. Taking responsibility for the activities of its agent institutions, for which they have
entered into agreement with the COU.
1 Entities authorised to operate as Payment Aggregator under PSS Act, 2007 (will include existing PAs
which have been granted in-principle authorisation)7. Escrow Account Operations
i. A non-bank BBPOU shall open an escrow account with a Scheduled Commercial Bank
exclusively for BBPS transactions.
ii. Non-bank BBPOU operates as Payment Aggregator (PA) when it collects funds from
its customers or settles funds with the billers onboarded by it. For the purpose of
maintenance of escrow account, payment system operated by BBPOU shall be
deemed to be ‘designated payment system’ under Section 23A of the PSS Act,
2007 (as amended from time to time).
iii. Eligible credits and debits in the escrow account of a COU are as follows:
a. Credit of funds collected from the customers
b. Debit towards settlement of BBPS transactions
c. Credit / debit of failed / disputed transactions
d. Recovery of charges / commissions pertaining to bill payment transactions
iv. Eligible credits and debits in the escrow account of a BOU are as follows:
a. Debit of funds due to the billers
b. Credit towards settlement of BBPS transactions
c. Credit / debit of failed / disputed transactions
d. Recovery of charges / commissions pertaining to bill payment transactions
v. All other instructions applicable on escrow accounts as provided in Guidelines on
Regulation of Payment Aggregators and Payment Gateways dated March 17, 2020
(as updated from time to time) shall be applicable for BBPS Escrow Account.
8. Complaint Management and Grievance Redressal
i. NBBL shall put in place a dispute resolution framework for centralised end-to-end
complaint management in compliance with RBI’s guidelines on Online Dispute
Resolution (ODR) System for Digital Payments dated August 06, 2020, as updated
from time to time.
ii. All participating COUs and BOUs shall be integrated to the centralised system and
enable the customers and billers to raise and resolve disputes in accordance with the
dispute resolution framework of NBBL. BBPS reference number generated while
initiating the transaction shall be used for this purpose.
iii. COUs and BOUs shall ensure that failed transactions are dealt with in accordance with
the timelines prescribed in RBI’s circular on Harmonisation of Turn Around Time (TAT)
and customer compensation for failed transactions using authorised Payment Systems
dated September 20, 2019, as updated from time to time.9. Supersession of earlier BBPS related guidelines/circulars
Following guidelines and circulars issued in connection with BBPS have been superseded
by these Directions:
S.No. Circular No. Date Subject
Implementation of Bharat Bill
DPSS.CO.PD.No.940/02.27.020/ November
1. Payment System - Guidelines
2014-2015 28, 2014
(Updated as on May 26, 2022)
DPSS.CO.PD.No.605/02.27.020/ September Bharat Bill Payment System -
2.
2019-20 16, 2019 Expansion of biller categories
3. CO.DPSS.POLC.No.S-188/02- June 14, Bharat Bill Payment System –
27-020/2021-2022 2021 Addition of Biller Category
4. CO.DPSS.POLC.No.S-253/02- May 26, Bharat Bill Payment System –
27-020/2022-23 2022 Amendment to guidelines
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