People aware of the matter said both companies are currently running pilot programmes with a limited set of users. A source at PhonePe said the company is “piloting to a cohort of users”, while a source at CRED described the initiative as being in “super early days” and still under testing. Neither company has made an official public announcement on the matter.
The move comes after several fintech platforms had discontinued credit card-based rent payments following regulatory concerns around the use of credit cards for person-to-person (P2P) transactions. The Reserve Bank of India had earlier expressed discomfort with structures that effectively enabled credit card-funded transfers between individuals.
According to sources, the new model being tested by PhonePe and CRED is structured as a marketplace platform, with payment aggregators (PAs) handling customer verification and compliance requirements. Sources indicated that the framework is designed to align with RBI regulations and address concerns that had previously led to the suspension of such services.
Credit card rent payments had gained popularity among users seeking reward points, cashback benefits and short-term liquidity management. However, regulatory scrutiny prompted several fintech players, including PhonePe, CRED and Paytm, to halt the service in recent years.
The latest development follows changes made by some industry participants to revive the offering through modified transaction structures. Earlier this year, payment platforms such as RedGiraffe, PayZapp and NoBroker were reported to have resumed or continued facilitating rent payments via credit cards after revising their processes to meet regulatory requirements.
If the pilots are successful, PhonePe and CRED could officially relaunch credit card-based rent payments as early as next month, according to sources. The companies have not disclosed details regarding the scale of the pilots, potential fees, eligible card networks or launch timelines.
