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Calling CRED, PhonePe, PayTM and Amazon Pay users: if you cannot make credit card payments any more then read this

This article provides a solution for making credit card payments for banks that do not support BBPS from 1st July 2024.

Calling CRED, PhonePe, PayTM and Amazon Pay users: if you cannot make credit card payments any more then read this


Posted on 03 Jul 2024
Author: Sayan Sircar
5 mins read
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This article provides a solution for making credit card payments for banks that do not support BBPS from 1st July 2024.

Calling CRED, PhonePe, PayTM and Amazon Pay users: if you cannot make credit card payments any more then read this

📚 Topics covered:

What is the news?

From 1st July 2024, per RBI rules, third-party apps like CRED, PhonePe, PayTM and Amazon Pay must use the Bharat Bill Payment System (BBPS) to make credit card payments.

Let’s break this down:

  • What is a third-party app? Services mentioned above sit between the credit card user like you and me and the bank that has issued the card
  • What is BBPS? BBPS offers a universal interface for any service provider (insurance company, mobile, internet, electricity, magazine subscription, school fees etc) to receive one-time and recurring (say monthly) payments. The system is very robust and is monitored by the RBI
  • How do third-party apps make credit card payments? These apps directly settle the credit card payment to the card issuing bank via NEFT/IMPS/RTGS
  • What is the RBI regulation: Third-party apps must use BBPS going forward instead of direct payment

What is the problem then?

  • 34 banks issue credit cards in India
  • only 12 out of the 34 are live with BBPS
  • large card issuers like Axis, HDFC etc are not live on BBPS
  • credit card holders of the 22 non-BBPS banks can no longer use these third-party apps for bill payments

The problem affects those

  • who do not have an account with the same bank that was issuing the card
  • who were using these third-party apps for making credit card payments

How do you make credit card payments if your bank is not live on BBPS?

The solution is straightforward: make a National Electronic Fund Transfer (NEFT) transfer via Netbanking to pay the credit card bill.

All you need to do is:

  • map the credit card via the 16-digit card number and the correct IFSC code as an NEFT payee in your bank’s Netbanking site/app
  • make a ₹100 test transfer for the first time (this will settle in a few hours and you will get email/SMS confirmation from the card issuer bank)
  • the amount to be paid is on the credit card statement
  • use this facility going forward

The biggest benefit of bill payment via NEFT is the robustness of the NEFT payment network which operates almost 24x7 and there is no third party involved in the chain.

We have a detailed article on this concept here: How to pay your credit card bill by NEFT?

The article also has a large list of IFSC codes specific to credit card payments.

Did you know that we have a private Facebook group which you can join for free and ask your own questions? Please click the button below to join.

How to make credit card payments via NEFT for banks not yet on BBPS?

You already have the card number. All you need is the IFSC code. Here are the IFSC codes for select card-issuing banks not yet live on BBPS:

Card issuer IFSC Link to bank site Google search
Axis Bank UTIB0000400 Axis website Google search
HDFC Bank HDFC0000128 HDFC website Google search
IDFC First Bank IDFB0010225 IDFC First website Google search
Indian Bank IDIB000C106 Indian Bank website Google search
Indian Overseas Bank IOBA00CARDS Indian Overseas Bank website Google search
YES Bank YESB0CMSNOC YES Bank website Google search

Pro tip: A few these banks even offer credit-card payment via UPI. The details will be there on their website.

A more extensive list is here.

Also read
How to correctly calculate returns from an under construction flat?

Should you wait for BBPS to be activated by your bank before making credit card payments?

Most credit card payments will be due within the next 30 days at most. Banks, as per news report, will take “months” to onboard BBPS. It is advisable to use the NEFT method or open an account with the card issuer bank which may not be always practical.

Of course, there are severe interest charges of 3%/month + GST on the entire outstanding balance if you delay a credit card payment.

Related:
Don't Get Caught in the Credit Card Debt Trap: Unmasking Interest Calculation & GST Charges

What about credit card payment reminders?

Many of these third-party apps offer payment reminders. You can use the calendar app on your smartphone (iPhone or Android) to create a recurring reminder to go off before the credit card due date. This app is built into all smartphones.

Which card-issuer banks are live on BBPS?

The following credit-card issuer banks are live on BBPS:

  • AU Small Finance Bank
  • Bank of Baroda
  • Canara Bank
  • Federal Bank
  • ICICI Bank
  • IDBI Bank
  • IndusInd Bank
  • Kotak Mahindra Bank
  • Punjab National Bank
  • Saraswat Bank
  • SBI
  • Union Bank of India

Cardholders can use third-party apps to make payments for these cards. But there is no real reason to do so given that the business models of free services include harvesting personal data.

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This post titled Calling CRED, PhonePe, PayTM and Amazon Pay users: if you cannot make credit card payments any more then read this first appeared on 03 Jul 2024 at https://arthgyaan.com


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