RBI Approves NPCI Bharat BillPay to Implement an Interoperable Payment System for Internet Banking Transactions

The Reserve Bank of India (RBI) has approved NPCI Bharat BillPay Ltd to implement an interoperable payment system for internet banking transactions. The new system will facilitate quicker settlement of funds for merchants.

Expected to be launched during the current calendar year, the new system will enable customers to pay businesses through net banking irrespective of whether their banks and the merchants’ payment aggregator are integrated.

Currently, online merchant payment transactions are processed through payment aggregators, which are not interoperable. So a bank is required to separately integrate with each payment aggregator of different online merchants.

India accounts for 46% of the world's digital transactions.

Speaking at an event "Digital Payment Awareness Week" in Mumbai, RBI Governor Shaktikanta Das said, "Internet Banking is one of the oldest modes for online merchant payment transactions. It is a preferred channel for payments like income tax, insurance premium, mutual fund payments and e-commerce."

Governor Das said that there is no common payment system and a set of rules for digital transactions at the moment. But when it comes to digital transactions, the world is looking at India, he said.

The proposed interoperable net banking payments will act as a clearing house to settle internet banking transactions between customers and merchants. This would eliminate the need for individual tie-ups.