## Report on Reserve Bank of India - Bharat Bill Payment System Directions, 2024
**1. Executive Summary:**
This report analyzes the Reserve Bank of India (RBI) Bharat Bill Payment System (BBPS) Directions, 2024, issued on February 29, 2024. This is a *new policy* that establishes a revised regulatory framework for the Bharat Bill Payment System (BBPS). The core purpose, as inferred from the document, is to streamline bill payments, broaden participation within the system, and bolster customer protection. Key provisions encompass defining roles and responsibilities for various participants like the Bharat Bill Pay Central Unit (BBPCU) and Bharat Bill Payment Operating Units (BBPOUs), setting authorization requirements, and establishing guidelines for escrow account operations and grievance redressal. The directions are effective from April 1, 2024, superseding previous BBPS-related guidelines.
**2. Introduction:**
This report aims to provide a comprehensive overview of the Reserve Bank of India's (RBI) Bharat Bill Payment System (BBPS) Directions, 2024, based solely on the information contained within the provided policy text. The report outlines the policy's objectives, key provisions, affected stakeholders, and anticipated impact, offering a clear understanding of the new regulatory framework for the BBPS.
**3. Policy Overview:**
* **Core Objective(s):** Based on the text, the core objectives of the BBPS Directions, 2024 are to:
* Streamline the bill payment process.
* Enable greater participation in the BBPS.
* Enhance customer protection within the system.
**4. Background and Rationale:**
As this is a new policy, the text suggests that the previous regulatory framework (RBI Circular DPSS.CO.PD.No.94002.27.020201415 dated November 28, 2014) required updating due to "significant developments in the payments landscape." This indicates a need to adapt the BBPS to accommodate advancements in payment technologies and evolving market dynamics. The policy aims to create a more efficient, inclusive, and secure bill payment ecosystem.
**5. Key Provisions / Changes:**
This section details the main components, rules, and actions mandated by the BBPS Directions, 2024:
* **Authorization Requirement:** NBBL is authorized as the Payment System Provider for BBPS. Any entity operating a system for bill payments *outside* the scope of BBPS requires authorization under the Payment and Settlement Systems (PSS) Act, 2007.
* **Definitions:** Clearly defines key terms such as Agent Institution, BBPCU, BBPOUs (Biller Operating Unit/Customer Operating Unit), BBPS, Bill, Biller, Biller Aggregator, Sponsor bank and Technology Service Providers, providing a common understanding of the system's components.
* **Participants in BBPS:** Specifies the participants, including NBBL (as BBPCU), Banks (Scheduled Commercial Banks, RRBs, Urban Cooperative Banks, State Cooperative Banks, District Central Cooperative Banks), non-bank Payment Aggregators and other authorized entities as BBPOUs. Banks and non-bank PAs do not need separate authorization but need to inform DPSS, RBI, Central Office before commencing operations.
* **Roles and Responsibilities:** Defines the roles and responsibilities of the BBPCU (NBBL), BOUs, and COUs. This includes setting rules, technical standards, ensuring guaranteed settlement, onboarding billers, providing customer interfaces, and establishing dispute resolution mechanisms. Notably, the BBPCU must ensure that no funds flow through any TSP.
* **Escrow Account Operations:** Mandates non-bank BBPOUs to open escrow accounts with Scheduled Commercial Banks for BBPS transactions. Specifies eligible credits and debits for COUs and BOUs, outlining permissible fund flows within the escrow accounts.
* **Complaint Management and Grievance Redressal:** Requires NBBL to implement a centralized dispute resolution framework in compliance with RBI guidelines on Online Dispute Resolution (ODR). All COUs and BOUs must integrate into this system. Specifies adherence to RBI timelines for handling failed transactions.
* **Supersession of Earlier Guidelines:** Explicitly supersedes earlier BBPS-related guidelines and circulars, as listed in the document.
**6. Target Audience and Stakeholders:**
The policy directly affects the following stakeholders:
* **NPCI Bharat Bill Pay Limited (NBBL):** As the BBPCU, NBBL is responsible for implementing and overseeing the BBPS framework.
* **Bharat Bill Payment Operating Units (BBPOUs):** Including Scheduled Commercial Banks, RRBs, Urban Cooperative Banks, State Cooperative Banks, District Central Cooperative Banks, non-bank Payment Aggregators, and other authorized entities.
* **Billers:** Entities that connect to BBPS through BOUs for collecting bill payments.
* **Customers:** Individuals and entities that use BBPS to pay bills.
* **Agent Institutions:** Entities that provide customer interfaces for bill payments.
* **Technology Service Providers (TSPs):** Entities certified by NBBL to provide technology services and solutions to integrate with BBPS.
**7. Implementation Aspects (Inferred):**
* **Responsible Agency/Bodies:** The Reserve Bank of India (RBI) through its Department of Payment and Settlement Systems (DPSS) is the primary regulatory body. NPCI Bharat BillPay Ltd (NBBL) is responsible for operating the BBPS.
* **Timelines:** The Directions are applicable from April 01, 2024.
* **Procedures:** Banks and non-bank PAs intending to operate as BBPOUs must intimate DPSS, RBI, Central Office before commencing operations. Non-bank BBPOUs must open escrow accounts with Scheduled Commercial Banks. COUs and BOUs must integrate into NBBL's centralized dispute resolution system.
**8. Expected Outcomes / Impact of Changes:**
The intended outcomes of the BBPS Directions, 2024, based on the policy's provisions, are likely to include:
* **Increased Efficiency:** Streamlined bill payment processes through a unified platform and standardized procedures.
* **Wider Participation:** Expanded access to BBPS for various entities, including banks, non-bank payment aggregators, and billers.
* **Enhanced Customer Protection:** Improved dispute resolution mechanisms and adherence to timelines for failed transactions.
* **Greater Transparency:** Clearer definition of roles and responsibilities for all participants in the BBPS ecosystem.
* **Improved Security:** Focus on escrow account management, guaranteed settlement and ensuring no funds flow through any TSP.
**9. Conclusion:**
The Reserve Bank of India's Bharat Bill Payment System Directions, 2024, represent a significant update to the regulatory framework governing bill payments in India. By streamlining processes, encouraging broader participation, and strengthening customer protection, the policy aims to create a more efficient, reliable, and user-friendly bill payment ecosystem. The effectiveness of these Directions will depend on the successful implementation by NBBL and the compliance of all participating entities. The specific changes, particularly those related to escrow account management and dispute resolution, are expected to have a tangible impact on the security and efficiency of BBPS transactions.
Key Entities Referenced
RESERVE BANK OF INDIA: The central bank of India, the issuer of the policy document.
RBIDPSS202324111: Reference number of the RBI document.
CO.DPSS.POLC.No.S111402270202020232024: Another reference number for the document, likely a more specific identifier.
February 29, 2024: Date of the notification.
All Scheduled Commercial Banks including RRBs Urban Cooperative Banks State Cooperative Banks District Central Cooperative Banks: Target audience of the notification: various types of banks.
NPCI Bharat BillPay Limited: An entity involved in bill payment processing.
Nonbank Payment System Participants: Another part of the target audience of the notification.
Master Direction Reserve Bank of India Bharat Bill Payment System Directions, 2024: The title of the primary directive being issued.
Bharat Bill Payment System: An integrated bill payment platform.
BBPS: Abbreviation for Bharat Bill Payment System.
RBI Circular DPSS.CO.PD.No.94002.27.020201415 dated November 28, 2014: A previous circular related to BBPS that the current direction supersedes.
NPCI Bharat Bill Pay Ltd: Synonym for NPCI Bharat BillPay Limited, acting as the Central Unit.
NBBL: Abbreviation for NPCI Bharat Bill Pay Ltd.
Bharat Bill Payment Operating Units: Entities that participate in the BBPS system.
BBPOUs: Abbreviation for Bharat Bill Payment Operating Units.
Agent networks of the BBPOUs: Network of agents operating under BBPOUs.
Statement on Developmental and Regulatory Policies dated June 08, 2023: A statement that announced the revised regulatory framework.
Payment and Settlement Systems PSS Act, 2007: The legal basis for the directions.
PSS Act, 2007: Abbreviated form of Payment and Settlement Systems Act, 2007.
Act 51 of 2007: Act number of the Payment and Settlement Systems Act, 2007.
Gunveer Singh: Chief General Manager-in-Charge at RBI, signatory of the notification.
Department of Payment and Settlement Systems, Central Office: The department within RBI responsible for the notification.
Mumbai 400001: Location of the RBI Central Office.
April 01, 2024: Effective date of the directions.
National Payments Corporation of India: Parent company of NBBL.
Section 21i of PSS Act 2007: Section of the PSS act which defines payment systems requiring authorization.
Chapter III of the Act: Chapter in the PSS Act related to authorization requirements.
Agent Institution: An entity certified by NBBL that provides customer interface for bill payments.
Bharat Bill Pay Central Unit: The central unit which operates BBPS.
BBPCU: Abbreviation for Bharat Bill Pay Central Unit.
Biller Operating Unit: A BBPOU that onboards billers onto the BBPS platform.
BOU: Abbreviation for Biller Operating Unit.
Customer Operating Unit: A BBPOU that provides customers with an interface to pay bills.
COU: Abbreviation for Customer Operating Unit.
Bill: Any notice for payment raised by a biller for recurring or nonrecurring payments.
Biller: An entity that is connected to BBPS through a BOU for collection of bill payments.
Biller Aggregator: An entity which aggregates billers for the purpose of enabling them to connect to a BOU.
Sponsor bank: A Scheduled Commercial Bank which facilitates settlement of nonbank BBPOUs with NBBL.
Technology Service Providers: Entities certified by NBBL to provide technology services and solutions to billers BBPOUs Agent Institutions to integrate with BBPS.
TSP: Abbreviation for Technology Service Providers.
Payment Aggregators: Entities which aggregates payments.
PAs: Abbreviation for Payment Aggregators.
DPSS, RBI, Central Office: Department of Payment and Settlement Systems, Reserve Bank of India, Central Office.
Guidelines on Regulation of Payment Aggregators and Payment Gateways dated March 17, 2020: RBI guidelines regarding Payment Aggregators and Payment Gateways.
RBI's guidelines on Online Dispute Resolution ODR System for Digital Payments dated August 06, 2020: RBI guidelines regarding Online Dispute Resolution System for Digital Payments.
ODR System for Digital Payments: Online Dispute Resolution System for Digital Payments
RBI's circular on Harmonisation of Turn Around Time TAT and customer compensation for failed transactions using authorised Payment Systems dated September 20, 2019: RBI circular about Turn Around Time and customer compensation for failed transactions.
Harmonisation of Turn Around Time: TAT and customer compensation for failed transactions.
TAT: Abbreviation for Turn Around Time.
Circular No. DPSS.CO.PD.No.94002.27.020 November 28, 2014: Earlier circular related to the Bharat Bill Payment System.
DPSS.CO.PD.No.60502.27.020 September 16, 2019: Another circular related to the Bharat Bill Payment System.
CO.DPSS.POLC.No.S18802 June 14, 2021: Another circular related to the Bharat Bill Payment System.
CO.DPSS.POLC.No.S25302 May 26, 2022: Another circular related to the Bharat Bill Payment System.
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
***