When will CRED activate BBPS (Bharat Bill Payments System) option?

            CRED is an Invite only Credit Card Bill Payment App. Entry to CRED App requires a minimum CIBIL score of 700. The USP of CRED is its rewards points offered to its members for paying credit cards bills via CRED App.

            The Rewards are highly personalised depending on the member’s location, spend pattern, spend categories etc.

            Another CRED USP is the CRED protect feature. CRED Protect Feature is an AI backed system which is designed to track the complete journey of member’s credit card transactions i.e right from the transaction till the payment.

CRED Protect Feature reminds members of the due dates, analyses spend patterns, displays rewards points and other credit card statistics. 

            For CRED Protect Feature to be active, the member has to update the email id on which Credit Card Statement is received.  

 

            CRED just rolled out two new features on its APP i.e CRED Stash and RentPay.

‘CRED Stash’ is a Personal Loan product, aiming to offer a low-interest instant credit line, through a pilot with IDFC First Bank

‘RentPay’ is for monthly rent payments using credit cards.

Both the products are designed to increase the members interaction with CRED App, instead of accessing the app only for payment of credit card bills.

The curated rewards on the CRED App also are designed for increased interaction between members and CRED App.

Valuable statistics about CRED members can be collected via RentPay. These statistics can assist CRED Team to further fine-tune its offerings.

The next step to increase CRED App usage and encourage CRED Stash can be #BBPS.

The popularity of BBPS is on the increase. On an average, every day 5 lac Bill Payments are taking place on BBPS.

170+ billers are LIVE on BBPS with new billers being added every week. New Biller categories too are getting on-boarded.

Bharat Bill Payment System (BBPS) is an integrated bill payment system in India offering interoperable and accessible bill payment service to customers through a network of agents of registered member as Agent Institutions (AI) enabling multiple payment modes, and providing instant confirmation of payment.

            Key Benefits for CRED to integrate #BBPS into its platform.

01)  A good chunk of credit card transactions are towards Electricity, Water, Society Maintenance, Phone Bills, Taxes, Education Fees, Local Taxes, FASTag Recharge, insurance premiums. Loan EMIs via Credit Cards are still rare. Members will be happy to pay their BBPS bills via CRED App if the payment process is smooth and the famed CRED AI assists them in choosing the best credit card for payment.

02)  Bill Payments have a high recurring mode and members will access more and more the CRED App for day to day activities.

03)  Members will be encouraged to pay not only their own bills, but also bills of their friends and relatives.

 

Requisites:

A)     Integrate with a BBPOU. Level of Difficulty - Medium – CRED has tied up with AXIX Bank for it’s UPI handle and Axis Bank is active on BBPS platform too.

B)     Finalise the BBPS Payment Modes. Level of Difficulty – Medium – There can be only two Payment Modes i.e UPI and Credit Cards. UPI payment is already active on CRED. Credit Card Payment too is already active on CRED.

C)     Build a matrix for the member to decide the best Credit Card for payment of BBPS Bill. The matrix should display the 1) Due Dates of the linked credit cards 02) Approximate reward points per credit card for the specific transaction. Level of Difficulty - Medium – CRED already displays the due date.

D)     Build a matrix for ‘CRED Stash’ Credit Line for members to avail if and when required to pay their BBPS Bills. Level of Difficulty – Medium – This is not a difficult matrix as the basic blocks are in place.

E)     Reminder Matrix – Once the member fetches the respective bill, an reminder matrix for payment of the same. Almost all billers offer 15 days grace period. The reminder matrix can assist the members to pay their bills 3 days before the due date, instead of paying on the bill generation date. Level of Difficulty – Medium

So, when will CRED activate #BBPS on its App?

 

Disclaimer: As #friendofBBPS, my only Aim is to the Average Transaction Amount and Bills Volumes on BBPS. Nothing More, Nothing Less   

 

 

My Key Takeaway from the Chat between Mr.David Velez and Mr.Jitendra Gupta

          I was fortunate to be part of the chat between Mr.David Velez and Mr.Jitendra Gupta on 26^th  June 2020.

          The theme of the Chat was ‘Insight’s from NUBank Journey’. Mr.David Velez, Founder and CEO, NUBank was the guest and Mr.Jitendra Gupta, Founder and CEO, Jupiter was the Host.

          There were multiple takeaways for the audience from the chat which lasted about 45 minutes.  

          The key takeaway for me is: -

A)   Choose the less travelled path, have patience and success will be besides you. NUBank started of its journey with a Credit Card product rather than a Debit Card product. This was a bit risky, as most of NEO Banks started their journey with a Debit Card.

 

 

Other minor takeaways are:

01) This saying attributed to Mahatma Gandhi occupies a place of pride in NUBank’s Head Office -- First, they will ignore you, then they will laugh at you, then they will fight you and then you win”

02) Company culture is an important pillar for the company’s growth. The founders should not deviate from the company’s culture.

03) Customers prefer free services over paid services.

 

Brief about NUBank:

01) 2013 – Founding Year

02)  2014 – Launch of International Mastercard Credit Card. NIL Fees and can be completely managed through a Mobile App

03)  2017 – Launch of its loyalty program -- NUBank Rewards. The reward points never expire. 30 days freelook period followed by fees.

04)  2017 - Launch of NuConta – Digital Account

05)   2018 – Launch of Debit Card

06)  2019 – Launch of Personal Loans  

 

 

Brief about Jupiter:

 

01) Built with LOVE in India

02)  On the way for a Beta Launch in India

 

If you too were part of the Chat, what is your takeaway?

 

Disclaimer: The takeaways are my personal opinion only.

DigiHuman approach to reduce stress levels of YES Bank Retail Customers

YES Bank customers have had a roller-coaster ride in the last few days. 

As YES Bank customers can withdraw up-to INR 50,000 through ATMs, the physical rush at its branches is thinning down.

Now, the next challenge for customers, to withdraw more than INR50,000 but less than INR5,00,000 or available balance, which ever is less.

Disclaimer: These are my personal views only and do not reflect the any other’s views.  

I Pray to God that the need for RBI to activate this clause never arises.

Ref: MINISTRY OF FINANCE (Department of Financial Services) (BANKING DIVISION)

NOTIFICATION New Delhi, the 5th March, 2020

QUOTE

Without prejudice to the conditions stipulated in paragraph 2(a) of this Order in relation to payment to any depositor of the said banking company, the Reserve Bank may by a general or special order, permit the said banking company to allow payment to its depositors an amount in excess of Rs. 50,000/- (Rupees fifty thousand only) to meet unforeseen expenses, as under:

(i) in connection with the medical treatment of the depositor or any person actually dependent on him;

(ii) towards the cost of higher education of the depositor or any person actually dependent on him for education in India or outside India;

(iii) to pay obligatory expenses in connection with marriage or other ceremonies of the depositor or his children or of any other person actually dependent upon him;

(iv) in connection with any other unavoidable emergency:

Provided that the amount so allowed to be paid out of the balance lying to the credit of the depositor—

(a) shall be reckoned towards the payment due to him under any scheme of reconstruction or amalgamation as may be sanctioned by any competent authority in relation to the said banking company and subject to such conditions as may be provided under such scheme about appropriation of any payment made to a depositor of the said banking company before or on the coming into force of the scheme; and

(b) shall not exceed the sum of Rs. 5,00,000/- (Rupees five lakh only) or the actual balance lying to the credit of the account of such depositor, whichever is less.

UNQUOTE

Indicative approach to reduce the stress levels:

Maximum paperless, minimal human intervention, Dash Board

SEBI is already following ‘Digital Claim Process’ to process PACL Refunds.

More details can be read at the below links:

https://www.sebipaclrefund.co.in/

FAQs to enable PACL investors submit their claims @ https://www.sebipaclrefund.co.in/Pdf/en/FAQs.pdf

FORMAT OF BANKER’S VERIFICATION LETTER @ https://www.sebipaclrefund.co.in/Home/BankLetter

Cancelled Cheque Leaf @ https://www.sebipaclrefund.co.in/Home/CancelCheque

The main differentiator between PACL Refunds and YES Bank additional withdrawal is the various purposes for which withdrawals are permitted in YES Bank.

Hence the necessary documents will vary from one ‘unforeseen expense’, to another ‘unforeseen expense’,

Sr No	Scenario	Proposed Application flow
01)	Customers with Mobile Banking / Net Banking Access	Application process in case of above scenarios can be via Mobile Banking / Net Banking
02	Customers without Net Banking / Mobile Banking Acess	Application process in case of above scenarios can be via Mobile Banking / Net Banking Micro Site at www.yesbank.in
03	Senior citizens who are not tech savvy	Physically carry documents to YES Bank designated branches, and YES Bank will upload the documents in the dedicated website.

As the process flow can be like ‘PACL Refunds’, I am not elaborating much on the same.

The supporting documents required under each ‘unforeseen expenses’, should be arrived at and be part of the FAQs

All pay-outs to be other bank accounts only. Cash Pay-out is for Senior Citizens only. 

Acceptance Development Fund (ADF) – Should it be restricted only to Card Infrastructure??

          Reserve Bank of India in its Payment and Settlement Systems in India: Vision – 2019-2021 document outlines the need for ADF to facilitate innovations in Digital transactions and reduce the cost for digital transaction acquirers.

QUOTE 

Creation of an Acceptance Development Fund (ADF) to subsidise acquirers for deploying PoS acceptance infrastructure in tier-3 to tier-6 centres. This would help in facilitating innovation and reducing cost of such transactions.

UNQUOTE

          The share of digital transactions in Tier 3 to Tier 6 centres in the overall financial transactions’ portfolio is less when compared to Tier 1 or Tier 2 centres.

          One of the reasons for the low share of digital transactions in Tier 3 to Tier 6 centres, is the acquirer’s reluctance to deploy the required infrastructure for digital transactions stating a long gestation period.

          Hence, the need for an ADF to speed up the infrastructure roll-out for Safe Digital Transactions.

          The concept of Acceptance Development Fund (ADF) was first mentioned by Reserve Bank of India in ‘Concept Paper on Card Acceptance Infrastructure’, released in  March 2016.

          This concept paper outlines the contours of the ADF i.e ADF Management, contribution to ADF, parameters to receive grants from ADF etc.

          The March 2016 concept paper mentions about ADF to strengthen Card Acceptance infrastructure.

In other countries, Mastercard and Visa - the two dominant card network players, are a major contributor to ADF, as cards constituted a major chunk of digital transactions.

 However, the main differentiation between India and other countries is UPI. UPI has no parallel anywhere else.

The launch of UPI (Unified Payment System) has shaken the world of digital transactions. Digital transactions are no longer restricted to Net banking or Debit cards. Now, UPI commands a growing share of digital transactions.  

          Today’s POS terminals support a wide variety of digital transaction channels i.e Credit Cards, Debit Cards, UPI, BharatQR

Pinelabs, Innoviti, Flipkart -  Couple of POS terminals which accept payments via UPI.

          The day’s of POS terminals supporting only Credit Cards or Debit Cards are getting over.

          A cursory reading of ADF in other countries shows that the ADF is heavily tilted towards POS terminals.

However, as the formation of ADF picks up speed, there may debates on the varieties of digital transaction channels which may require ADF support.

          The beauty of India’s digital transactions is that it comprises a large number of channels, each channel having its plus and minus points.

          Let us wait and watch for the ADF rollout.

           

Malaysia’s central bank to improve the payment infrastructure in the country, set up the Market Development Fund (MDF) in 2015, under which credit card scheme providers can contribute by channeling 0.1% of each payment card transaction.

          Acceptance Development Funds have been successfully deployed in several countries, including Indonesia and Poland too.

           

Reserve Bank of India to unveil Regulatory Sandbox in the next two months

          At 25^th March, 2019,  NITI Aayog’s FinTech Conclave’s Keynote Address Shri Shaktikanta Das, Governor, Reserve Bank of India, mentioned about the need for Regulatory Sandbox.

          The theme of the keynote address is “Opportunities and Challenges of FinTech”

Quote

 The Reserve Bank’s working group on FinTech and digital banking (Report of the working group on FinTech and digital banking, November 2017) suggested the introduction of a 'regulatory sandbox/innovation hub' within a well-defined space and duration to experiment with FinTech solutions, where the consequences of failure can be contained and reasons for failure analysed. A ‘Regulatory Sandbox’ would benefit FinTech companies by way of reduced time to launch innovative products at a lower cost. Going forward, the Reserve Bank will set up a regulatory sandbox, for which guidelines will be issued in the next two months.

Unquote

          In simple terms, Sandbox is an isolated environment in which new approaches can be tested before releasing for Live use.

          Developers can run their test-cases in a controlled environment to observe the IT Applications behaviour and fine-tune for live use.

Sandbox is a special security feature which allows you to run potentially suspicious applications automatically in a completely isolated environment. Programs running within the sandbox have limited access to organisation files and system, so there is no risk to your computer or any of your other files.

Regulators in major financial markets have established regulatory ‘sandbox’ or testing environment for furthering financial technology and adoption

SEBI in mid-2017 set up a ‘Committee on Financial and Regulatory Technologies (CFRT)

One of the committee’s objective is to finalised the ‘Approach  and  framework  for  regulatory  sandbox  in  Indian  market  conditions  to  facilitate adoption of FinTech and promote financial innovations’.

IRDA in late 2018 set up a committee to frame guidelines on ‘Regulatory Sandbox’, in Insurance space in India. The committee has submitted its key recommendations to IRDA. IRDA in turn has sought feedback from general public before releasing the final guidelines.

The Insurance Regulatory Sandbox would have defined entry and eligibility criteria, boundary conditions, process flow, timelines and success factors / exit parameters for the applicants, along with appropriate controls for protection and risk management.

  

The above terms will be common to Finance Regulatory Sandbox and Stock Market Regulatory Sandbox.

The word ‘Regulatory Sandbox’, is also mentioned in ‘Report of the Working Group on FinTech and Digital Banking’, submitted to Reserve Bank of India in November 2017.

On of the committee’s key recommendations is:

In view of IDRBT’s unique positioning as a research and development institute, and as indicated by some of its activities, it is felt that IDRBT is well placed to create and maintain a regulatory sandbox in collaboration with RBI for enabling innovators to experiment with their banking/payments solutions for eventual adoption.

The Institute may continue to interact with RBI, banks, solution providers regarding testing of new products and services and over a period of time upgrade its infrastructure and skill sets to provide full-fledged regulatory sandbox environment. The Reserve Bank of India may actively engage with the Institute in this regard.