NPCI transfers automatic bill payments business to new subsidiary

The National Payments Corporation of India (NPCI) has transferred all its Bharat Bill Payment System (BBPS) transaction mandates to a new subsidiary called the NPCI Bharat BillPay Limited (NBBL), effectively hiving off its automated bill payment business. BBPS is an interoperable bill payments platform used by banks, fintech companies and biller merchants to automate bill collection and request solutions.

All licensed bill processors – banks and payment aggregators – on the platform received an email from NPCI on March 31, asking them to start accounting their billing transactions under NBBL from April 1.

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“As per the directive received by RBI, the Bharat Bill Payment Central Unit (BBPCU) business will be transferred from NPCI to NBBL – a wholly-owned subsidiary of NPCI – with effect from April 1,” read the email, a copy of which has been reviewed by ET.

“Please note that for all the transactions processed till midnight of March 31 the GST component can be booked under the old GSTN… and transactions processed from midnight of April 1 shall be booked under the new GSTN…,” NPCI added in its email.

The Reserve Bank of India is learnt to have directed NPCI to set up a separate subsidiary to scale the interoperable bill platform by the way of increased autonomy in operations and onboarding of new billers, according to sources.

A mailed query to NPCI didn’t elicit a response as of writing.

All leading banks and aggregators, including State Bank of India, HDFC Bank and BillDesk, among others, are licensed bill processors on the platform, and process monthly bill payments for thousands of telecom companies, gas companies, discoms, educational institutions and other billers in the country.

BBPS processed 35 million transactions worth Rs 5,196 crore for more than 19,000 billers in March, according to data released by NPCI on Thursday.

Sources told ET that both NPCI and RBI believe that BBPS has a massive growth ceiling, especially as a B2C payment platform for small businesses offering monthly solutions to customers.

“There is a massive potential to scale like the Unified Payments Interface,” said one of the sources. “Moreover, NPCI has its hands full with key channels such as UPI, IMPS, Aadhar Enabled Payment System and National Electronic Toll Collections (FasTag – NETC), among others.”

As per regulatory filings, NBBL is a public company registered in December 2020 with three directors – NPCI chief executive Dilip Asbe, SBI deputy managing director and chief digital officer Ravindra Pandey, and NPCI non-executive chairman Biswamohan Mahapatra. It has a paid-up capital of Rs 5 lakh and share capital of Rs 1 crore.

While a source said that the NBBL, unlike its parent NPCI, is a for-profit unit, ET couldn’t independently verify this. News daily The Financial Express was the first to report NPCI’s plan to hive off BBPS in November.

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