Which bank will be the first to pay its Utility Bills via BBPS?

I often wonder as to how banks pay their utility bills. The old-fashioned way i.e Demand Drafts or the new-fashioned way i.e BBPS.

On an average every day BBPS sees 5 lac transactions on its platform. With 250+ Billers on BBPS, BBPS is fast becoming India’s favourite channel for bill payments.

Now is the time for Banks too onboard BBPS for payment of their Utility Bills.

BBPS will get a major boost if all the Banks in India decide to pay their Utility Bills especially Electricity Bills via BBPS mode only.

This will be a major enabler for corporates all over India to pay their utility bills via BBPS. This will convince corporates to quickly adopt BBPS Payment Mode for their utility bills too.

Banks need to pay Electricity Bill, Water Bill, Landline Bill, of physical branches and administrative offices. Of course, water charges can be part of the monthly maintenance amount paid above the rent to the landlord.

As per RBI data base, as on 31^st March 2020, there are 1,56,329 Commercial Bank Branches functioning all over India. This number includes administrative offices as well as normal branches

Administrative Offices -    6,352

Branches                  - 1,49,977

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Total                          - 1,56,329

Co-operative Banks are not part of the above numbers. Of course, they too can pay utility bills via BBPS. Nothing stops them.

In simple terms, Commercial Banks pay 1,50, 000/+ Electricity Bills and a lesser number of water bills.

The number of landline bills is more as physical offices may have more than 1 landline.

Commercial Banks can remit the Utility Bills via their own Net Banking portal or tie up with any other bank if required. Regional Rural Banks can tie-up with their sponsor banks.

I look forward to a similar statement in the Banks Annual Reports.

 “We are proud to announce that 85% + utility bills of the Bank are paid through the BBPS mode only.

Further we have onboarded ____ + corporates to the BBPS Payment mode”

After all, 'The proof of the pudding is in the eating'

Q: Will it be difficult for banks to pay all their utility bills via BBPS

Ans: No, it will not be difficult. It requires one-time effort to set up the process, i.e

·         define the process flow,

·         set up internal accounts,

·         provide transaction rights for the identified bank staff

·         Tag the respective biller details

·         lay down audit activities