No Credit Card Repayments Via Third-Party Apps! This Is What It Means For You

Starting today, i.e. July 1, many customers will not be able to pay credit card bills through third-party applications. Credit card-holders of the majority of banks such as HDFC Bank, Axis Bank, etc. will not be able to pay their due amount via third-party apps such as CRED, PhonePe, Paytm among others as they are not yet live on the Bharat Bill Payment System (BBPS) platform of the National Payments Corporation of India (NPCI). Among the 34 banks that are authorised to issue credit cards, 22 have not yet become active on BBPS

As per the Reserve Bank of India’s (RBI) mandate, all credit card bill payments by third-party apps must be routed through NPCI’s BBPS starting July 1, 2024. The RBI circular on BBPS dated February 2024 intends to make banks and fintechs go live with the bill payment system.

Also Read: Big Warning From RBI On Cyber Attacks! How To Stay Safe?

What Does It Mean For You?

No Credit Card Payment On Select Banks: If you have a credit card from some major issuers such as ICICI, HDFC, and Axis Bank you will not be able to make the bill payment using third-party apps like Cred, Paytm, and PhonePe.

Note: While fintech apps such as PhonePe and CRED are members of BBPS, major credit card issuers such as HDFC, and Axis Bank are not yet live on the BBPS platform to receive credit card bill payments.

Third-Party Bill Payments For These Banks: If your credit is issued by State Bank of India (SBI), Bank of Baroda, Kotak Mahindra Bank, IndusInd Bank, Federal Bank, Canara Bank, RBL Bank and AU Small Finance Bank there is no need for you to worry. These banks are live on the BBPS platform therefore you can continue to make bill payments via third-party apps.

Payment mode: If your bank is not yet live on BBPS, you can still make credit card payments via various channels, namely:

- Websites of the issuing banks

- Net banking

- Particular apps of such banks

As per media reports, the Payments Council of India (PCI) has asked RBI to extend the deadline for BBPS compliance by 90 days. This request echoes the sentiment of fintech players and banks alike to avoid disruption in services.

What happens during third-party credit bill payments?

Unlike your regular credit card transactions, in the case of payments done via third-party applications, the fintech players such as PhonePe, CRED, etc., settle the amount to the bank through NEFT/IMPS or a direct transfer.

Reports say that RBI is uncomfortable with the idea that such transactions are not happening via a centralised platform but through many third-party fintech apps. Once all the banks and apps are live on BBPS the credit card bill payments will have a track record.