If you were using apps like PhonePe, Paytm, or CRED to pay house rent through your credit card, things are about to change. The Reserve Bank of India (RBI) has issued new guidelines for online payment apps, under which fintech companies will now have to discontinue this service.
These platforms were popular among users who wanted to earn credit card reward points while paying rent digitally. However, RBI now considers this system risky and has tightened the rules.
Why Was This Payment Option So Popular?
Until now, paying rent with a credit card offered several benefits. Tenants could enjoy an interest-free period, earn cashback or reward points, and manage their cash flow more efficiently.
Rent payments made through these apps reached landlords instantly, making the process simple and attractive—especially for young professionals and working tenants.
On 15 September 2025, RBI issued a circular to regulate payment aggregators and payment gateways. According to the new rules, these companies can only process payments for merchants with whom they have a direct agreement and where full KYC compliance has been completed.
This means landlords—who are not officially registered as merchants—can no longer receive rent payments via credit card transactions on these platforms. As a result, apps like PhonePe, Paytm, and CRED have now stopped offering this feature.
Also Read-: RBI’s New Guidelines for 32 Companies Including Paytm and PhonePe: 6 Key Rules
Banks Had Already Started Tightening Rules
Even before RBI’s announcement, several banks had begun restricting rent payments via credit cards. In June 2024, HDFC Bank introduced a 1% fee on such transactions. ICICI Bank and SBI Card also stopped offering reward points on rent payments made through credit cards.
Some fintech companies had suspended the service as early as March 2024, but later resumed it with stricter KYC requirements. Now, with RBI’s fresh directive, the option has been permanently discontinued.
What Does This Mean for Tenants?
The new rules will hit those who relied on this feature for better financial management. Many tenants used credit cards to pay rent without immediately touching their savings, while still enjoying the perks of digital payments. With this service gone, tenants will now have to switch back to more traditional payment methods.