Money & Banking

On-tap authorisation: RBI issues guidelines for BBPOU, White Label ATMs

Our Bureau Mumbai | Updated on October 15, 2019 Published on October 15, 2019

File photo   -  PAUL NORONHA

BBPOUs will be authorised operational entities, adhering to the standards set by the BBPCU for facilitating bill payments online as well as through a network of agents on the ground

As part of its on-tap authorisation criteria for non-bank payment system operators (PSOs), the Reserve Bank of India, on Tuesday, said entities desirous to function / operate / provide platforms for Bharat Bill Payment Operating Unit (BBPOU) and White Label ATMs (WLAs) will need to have a networth of ₹100 crore.

Further, entities desirous to function / operate / provide platforms for Trade Receivables Discounting System (TReDS) will need to have a minimum paid up equity capital of ₹25 crore. Non-promoters will have shareholding up to 10 per cent of equity capital

According to the RBI, BBPOUs will be authorised operational entities, adhering to the standards set by the BBPCU (Bharat Bill Payment Central Unit ) for facilitating bill payments online as well as through a network of agents on the ground. ATMs set up, owned, and operated by non-banks are called WLAs.

TReDS is an online platform for facilitating the financing of trade receivables of MSMEs from corporate buyers through multiple financiers. As per the eligibility criteria specific to BBPOUs, an applicant must have domain experience in the field of bill collection for a minimum period of one year. The RBI did not refer to any criteria specific to TReDS.

In the case of WLA operators (WLAOs), ATMs to be deployed in the ratio of 1 (for metro and urban): 2 (semi-urban): 3 (rural). Among the various regions, the RBI said the ratio will be in favour of rural regions.

If a WLAO deploys adequate ATMs in a rural region, it need not deploy ATMs in metro, urban or semi-urban regions to meet the ratio requirements. If a WLAO deploys ATMs in a semi-urban region, it should deploy adequate ATMs in a rural region as per the ratio and may not deploy any ATM in a metro or urban regions.

Among the common criteria for all the non-bank PSOs include: assessment of fit and proper criteria by the RBI, the importance of overall financial strength of the promoters / entity, sound technological basis to support its operations, management, and governance, among others.

Published on October 15, 2019
This article is closed for comments.
Please Email the Editor