UPI platforms: RBI adds more features to existing UPI, will allow multi debits, single block facilities for users

UPI platforms: RBI adds more features to existing UPI, will allow multi debits, single block facilities for users

UPI platforms: RBI governor Shaktikanta Das said users will be able to pay rent, school fees, tax, and other fees for professional services via Bharat Bill Payment System. At present, the system has been limited to recurring bill payments for merchants and utilities.

Bharat Bill Payment System was launched in 2017 and is a one-stop ecosystem for payment of all bills Bharat Bill Payment System was launched in 2017 and is a one-stop ecosystem for payment of all bills

The Reserve Bank of India (RBI) on Wednesday said that it would introduce additional features to the existing Unified Payments Interface (UPI) platforms that would allow multiple debits. The central bank will roll out single-block and multiple debit functionality that will enable users to block funds in their accounts.  

This would enhance the process of payment for online transactions, and investments in securities.  

At present, users can make recurring payments through the UPI AutoPay feature. But merchants can only have a single debit to receive payment. With the added feature, merchants can make multiple debit transactions within a permitted limit. 

RBI governor Shaktikanta Das, who started his speech on UPI with his praise for the digital payment system, said the new feature will be helpful in the purchase of government securities using the RBI’s retail direct scheme.  

He noted that separate instructions will be issued to the National Payments Corporation of India (NPCI) to implement the enhancement. 

Bharat Bill Payment System 

The governor added that the scope of the Bharat Bill Pay System (BBPS) will be expanded to include non-recurring bills and other types of single payments. The BBPS was launched in 2017 and is a single platform for the payment of all bills.

Currently, BBPS does not have a facility to process non-recurring payments or collection requirements of individuals even if they are recurring in nature.  

With the current additions, the BBPS will include all categories of payments and collections, both recurring and non-recurring in nature, and for all categories of billers, both businesses, and individuals. 

“The new system will make the BBPS platform accessible to a wider set of individuals and businesses who can benefit from the transparent and uniform payments experience, faster access to funds, and improved efficiency,” Das said at the Monetary Policy Committee (MPC) meeting on Wednesday. 

Das added that users can make easy professional service fee payments, education fees, tax payments, and rent collections with the addition. 

Sector voices 

“The most pivotal aspect of today’s announcement is the integration of Single-Block-and-Multiple-Debits (SBMD) within the UPI framework. Essentially, SBMD allows users and merchants to decide on a certain limit to which a credit card may be authorised, making it convenient for customers and giving confidence to merchants. Now that UPI is capable of similar services, it is poised to increase its reach considerably making it the most popular mode of payment in the near future, in line with RBI’s vision. This almost puts UPI on par with a traditional credit card. So, we are very positive about the development as it gives digital platforms like ours an opportunity to offer additional benefits to customers through UPI integration,” said Krishnan Vishwanathan, Founder and Executive Director, RING. 

“RBI's recent plans to introduce single-block-and-multiple debit in UPI will make the process of making payments more effortless and organised. Customers can now create a payment mandate against a merchant by blocking money in their bank accounts, which can be debited at any time. Currently, customers can make recurring payments for SIPs, OTT subscriptions, etc., through the UPI Autoplay facility. RBI has the vision to expand this feature toward e-commerce platforms. This new aspect will make it easy for customers to invest in securities, shop online, book hotels, etc. Additionally, merchants will receive significant assurance of timely payments while the customer still holds his fund in his account until the actual delivery,” said CA Manish P. Hingar, Founder at Fintoo. 

"RBI’s announcement with respect to UPI payments and Bharat Bill Payment System (BBPS) are encouraging in the payments ecosystem. The RBI’s announcement around increasing the capacity of UPI by introducing single-block and multiple debits functionality will enable users to block funds in their account, which can be debited at the time of need.  This will make it more convenient to make payments towards investments in securities through the RBI’s Retail Direct platform and e-commerce transactions. RBI has been working towards boosting the efficiency and effectiveness of BBPS, to facilitate and accelerate the adoption of cashless payments, and today’s announcement to expand its scope will further aid in increasing the accessibility for a wider set of individuals and businesses," said Akash Sinha, CEO & Co-founder, Cashfree Payments. 

Published on: Dec 07, 2022, 3:14 PM IST
Posted by: Basudha Das, Dec 07, 2022, 3:02 PM IST