If you miss the due date of a bill, you will be charged some penalty. Those who don't have time to stand in long queues, often opt to pay online rather than visiting collection outlets of billers for making payments. You can also avail the auto debit facility or pay by using credit card. But these systems also have their limitations. If your bank doesn't have a tie-up with the biller, you won't get auto debit facility. Moreover, if you have enrolled for 10 services, it is likely that you will have to visit websites of respective service /utility providers and honour bills separately for each of them. This process is cumbersome and time consuming. Often banks charge you per transaction which results in cost escalation. But soon this situation might change.

What will change now?
RBI had appointed an advisory committee to look into the mechanisms and structure of a nation-wide bill payment service. As per the observations made by the committee, cash and cheque payment modes still dominate the payment systems in India. With an aim of encouraging people for using electronic payment systems and lowering their dependence on cash, the committee recommended that pan-India integrated bill payment system should be developed. The committee further recommended that, a not-for-profit entity, Bharat Bill Payment System (BBPS) and a for-profit entity, Bharat Bill Payment Operating Units (BBPOUs), should be setup. Aforesaid entities would have distinctive roles. While BBPS would have to set standards and would be responsible for brand positioning, BBPOUs would carry out functions such as enlisting billers, providing infrastructure, handling transactions, customer grievances and providing value added services.

Would payers be better served?
PersonalFN believes that, introduction of pan-India payment system providing gateway for paying all bills may prove to be extremely effective. In view of PersonalFN, the centralised online platform would help billers keep data in electronic form for their records. As far as payers are concerned, honouring bills would become less tedious. At present, you need to remember different login ids and passwords to be able to make payments online. Further, the proposed system would also provide historical records of all transactions carried out by the payer. Since the process is established via Government Internal Revenue Order (GIRO) based system, it might become easy for tax department to monitor earnings of various businesses, if needed in future.

PersonalFN is also of the view that, in India, currently, people are reluctant to make online payments for various reasons. One of the reasons is security. But, given that roles of both, BBPS and BBPOUs are well-defined and both of them are expected to follow good governance practices, concerns pertaining to payment security may be addressed to a great extent. Transaction volume in payments through Electronic Clearing System (ECS) has been growing at only 5% for a last few years and stands approximately at Rs 17.6 crore. Considering India's potential in increasing penetration of banking services, such growth would be considered low. PersonalFN believes, if people feel confident about using new centralised payment system, dependence on cash-based transaction may go down substantially in years to come.

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