RBI Directs Card Networks to Halt BPSP Transactions
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RBI Directs Card Networks to Halt BPSP Transactions

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Questions and Answers

What action has the Reserve Bank of India (RBI) recently directed Visa and Mastercard to take?

  • Stop enabling commercial transactions by Business Payment Solution Providers (BPSPs) (correct)
  • Expand commercial transactions with BPSPs
  • Offer discounts to BPSPs
  • Promote BPSP transactions

    • Why did the RBI ask Visa and Mastercard to halt transactions with BPSPs?

  • To encourage more transactions through BPSPs
  • Due to violation of the Payment and Settlement Systems Act, 2007 (correct)
  • To reduce the use of virtual credit cards
  • As a reward for BPSP's compliance

    • How do Business Payment Solution Providers (BPSPs) facilitate business-to-business payments?

  • By allowing corporates to pay suppliers using virtual credit cards (correct)
  • By providing personal loans to businesses
  • By investing in stock markets on behalf of businesses
  • By offering free credit card services to individuals

    • What mechanism do BPSPs provide for businesses to accept card payments?

    <p>Online platform for managing payments</p> Signup and view all the answers

    How do BPSPs enable businesses to make payments to smaller suppliers?

    <p>By allowing payments through RTGS and NEFT transfers</p> Signup and view all the answers

    What is one of the main concerns of the Reserve Bank of India regarding BPSPs?

    <p>Inability to track the end utilization of funds</p> Signup and view all the answers

    How are specialized BPSP providers like EnKash and Kodo impacted by the recent directions from RBI?

    <p>They must stop providing virtual commercial card payment services</p> Signup and view all the answers

    What is the utility of BPSPs for businesses as mentioned in the text?

    <p>Facilitating urgent B2B payments without credit card acceptance infrastructure</p> Signup and view all the answers

    How do commercial cards differ from BPSPs in the context of B2B payments?

    <p>Commercial cards streamline B2B payments, while BPSPs manage cash flows</p> Signup and view all the answers

    What triggered the RBI's regulatory scrutiny over BPSPs according to the text?

    <p>Specific instances of dubious practices like unregistered merchants</p> Signup and view all the answers

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