The Reserve Bank of India (RBI) is gearing up to introduce an interoperable payment system for internet banking, aimed at accelerating fund settlements for merchants and further boosting online transactions. Governor Shaktikanta Das announced this development during the ‘Digital Payments Awareness Week’ celebration in Mumbai.
The RBI has granted approval for the implementation of an interoperable system to NPCI Bharat BillPay Ltd (NBBL), a wholly-owned subsidiary of NPCI, indicating a significant step towards seamless digital transactions.
‘We expect the launch of this interoperable payment system for internet banking during the current calendar year. The new system will facilitate quicker settlement of funds for merchants,’ stated Governor Das.
The proposed system is designed to allow customers to make payments to businesses through net banking, regardless of whether their banks and the merchants’ payment aggregator are integrated. Currently, online merchant payment transactions are processed through non-interoperable payment aggregators, necessitating separate integrations for each bank.
Explaining the current challenges, Das highlighted, ‘If a customer wants to make a payment from their bank account to a specific merchant, there must be an arrangement between the merchant’s payment aggregator and the customer’s bank. Given the multitude of payment aggregators, it becomes challenging for each bank to integrate with all of them.’
The lack of a standardized payment system and clear rules for these transactions has led to delays in merchants receiving payments and poses settlement risks. Governor Das termed this situation a bottleneck in the digital payment ecosystem.
‘As a regulator, we are committed to playing our part in India’s journey in digital payments,’ Governor Das emphasized, underscoring the RBI’s dedication to fostering a robust and efficient digital payment infrastructure.
This move by the RBI is anticipated to streamline online transactions, enhance payment security, and provide a significant boost to India’s digital economy.
