In a significant move towards enhancing the efficiency of digital transactions, Reserve Bank of India Governor Shaktikanta Das announced the expected launch of an interoperable payment system for internet banking in 2024. This innovative system aims to streamline the process of online merchant payments, ensuring quicker settlement of funds for merchants and reducing settlement risks.
Internet banking, a longstanding method for executing online transactions, is widely used for various payments, including income tax, insurance premiums, mutual fund investments, and e-commerce purchases. However, the current framework, which processes transactions through Payment Aggregators (PAs), lacks interoperability. This limitation necessitates banks to establish separate integrations with each PA, complicating the transaction process and delaying payments to merchants.
Addressing these challenges, the RBI’s Payments Vision 2025 proposed the creation of an interoperable payment system for internet banking transactions. Following this vision, the RBI has approved NPCI Bharat BillPay Ltd (NBBL) to implement the system. Governor Das expressed optimism about the system’s launch within the current calendar year, highlighting its potential to enhance merchant satisfaction and consumer confidence in digital payments.
The introduction of this system is part of the RBI’s broader commitment to advancing India’s digital payment infrastructure. Governor Das also praised the Unified Payments Interface (UPI), which has gained international acclaim for its efficiency and widespread adoption. UPI’s contribution to digital payments neared 80% in 2023, with daily transactions reaching approximately 42 crore.
Emphasizing the importance of trust in digital payments, Governor Das underscored the critical role of transparency, ease of use, and security. Reinforcing these pillars is essential to maintaining and enhancing user confidence in the digital payment ecosystem.
As India continues to progress in its digital payment journey, the RBI’s initiatives, including the upcoming interoperable payment system for internet banking, are set to further facilitate the country’s transition towards a more efficient and secure digital economy.
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