Reserve Bank on Thursday constituted an advisory group to implement a national bill payment system that will enable households to pay utility bills, school fees, remittances and other bills using their bank accounts.

“The RBI has announced the constitution of a GIRO Advisory Group (GAG) to implement a national GIRO-based Indian Bill Payment System such that households will be able to use bank accounts to pay school fees, utilities, medical bills and make remittances electronically,” RBI said in a notification.

A GIRO is a payment instruction from one bank account to another bank account initiated by a payer. It facilitates payment through cash, cheque, credit/debit cards and prepaid payment instruments in transfer of funds to the bank account of a beneficiary.

The terms of reference of GAG include suggesting nature of organisation — either existing or formation of new entity — to carry the GIRO based bill payments as well as forming guidelines for setting up and operating the system.

Among others it will also recommend criteria for the organisation to seek authorisation for setting up bill payments in the country in terms of financial, governance, ownership, technical, operational aspects.

RBI said if GAG is of the opinion that a new organisation be created on the lines of entity like National Payments Corporation of India (NPCI) then it should also make recommendations on nature of organisation, identification of CEO, location and base of headquarters, membership composition and capital structure, and contributions by stakeholders.

The nine member GAG, will have Umesh Bellur as its chairman.

Mr. Bellur is a Professor in the Indian Institute of Technology, Bombay.

The GIRO Advisory Group would submit its report by end of December 2013, RBI added.

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