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NPCI Launches BBPS Pilot Project
Sep 16, 2016

National Payments Corporation of India has recently launched the pilot project for Bharat Bill Payment System (BBPS) with 26 Bharat Bill Payment Operating Units.

  • BBPS is the Reserve Bank mandated system which will provide interoperable bill payment services to customers.
  • In the first phase, BBPS will cover repetitive payments for everyday utility services such as electricity, water, gas, telephone and direct-to-home (DTH).
  • In due course of time BBPS would link all major billers in the country with all their consumers which will simplify bill payments electronically.
  • Currently, the volume of bills being paid by cash is so large that even if 25 per cent of the bills get paid electronically, the impact would be visibly enormous.
  • Some of the banking entities which are participating in the pilot project include—AP Mahesh Cooperative Urban Bank, Axis Bank, Gopinath Patil Parsik Janata Sahakari Bank, HDFC Bank, ICICI Bank and IDBI Bank. Besides, there are Indian Bank, IndusInd Bank, Kotak Mahindra Bank, Punjab & Maharashtra Co operative Bank, Punjab National Bank, RBL Bank and State Bank of India.
  • Avenues India, Common Service Centre, Euronet Services, IndiaIdeas.com (Billdesk), ITZ Cash Card Ltd, One97 Communications Ltd (Paytm), Oxigen Services India Pvt. Ltd, PayU Payments Pvt. Ltd, Spice Digital Ltd and TechProcess Payment Services Ltd are the non-banking entities which are part of the pilot project.

BBPS is an integrated platform connecting banks and non-bank entities in bill aggregation business like billers, payment service providers and retail bill outlets. As on date, 62 entities have received in-principle approval from RBI to function as Operating Units, out of which 52 are banking and 10 are non-banking entities.

NPCI functions as the authorised Bharat Bill Payment Central Unit (BBPCU) which will undertake clearing and settlement activities related to transactions routed through BBPS.

What is NPCI?

  • National Payments Corporation of India (NPCI) is an umbrella organization for all retail payments system in India. It was set up with the guidance and support of the Reserve Bank of India (RBI) and Indian Banks’ Association (IBA).
  • The RBI, after setting up the Board for Regulation and Supervision of Payment and Settlement Systems (BPSS) in 2005, released a vision document incorporating a proposal to set up an umbrella institution for all the RETAIL PAYMENT SYSTEMS in the country.
  • The core objective was to consolidate and integrate the multiple systems with varying service levels into nation-wide uniform and standard business process for all retail payment systems. The other objective was to facilitate an affordable payment mechanism to benefit the common man across the country and help financial inclusion.
  • NPCI was incorporated in December 2008 and the Certificate of Commencement of Business was issued in April 2009.
  • It is aimed to operate for the benefit of all the member banks and their customers. The authorized capital was pegged at Rs 300 crore and paid up capital was Rs 100 crore. The aim is to create infrastructure of large dimension and operate on high volumes resulting in payment services at a fraction of the present cost structure.


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