RBI Orders BNPL Firm Simpl to Shut Payments Operations
Why in the news
In September 2025 the RBI ordered Simpl to stop its payments business immediately because it ran a payment system without approval.
Key facts
- Law breached: Payment and Settlement Systems Act, 2007.
- RBI worries: unsecured lending, weak oversight, poor consumer protection.
- 2022 rule pulled BNPL closer to digital lending regulation.
About BNPL
Buy-Now-Pay-Later lets shoppers take goods now and pay in instalments, often interest-free briefly.
- Customer picks BNPL at checkout.
- Provider pays the merchant upfront.
- Customer repays the provider in equal instalments.
Relevant laws
| Law | Applies when |
|---|---|
| RBI Act, 1934 | RBI regulates banks and non-bank lenders |
| Banking Regulation Act, 1949 | Provider acts as a bank |
| NBFC Directions and Digital Lending Guidelines 2022 | Provider is an NBFC |
| Payment and Settlement Systems Act, 2007 | Provider issues prepaid instruments |
Exam angle
- Firm: Simpl. Act: PSS Act, 2007.