Reserve Bank Gives Payment Aggregators Another Window Till September To Apply For Licence

RBI has said that payment aggregators should have a minimum net worth of Rs 15 crore as on March 31, 2022

The Reserve Bank of India (RBI) has given some respite to payment aggregators (PAs). The central bank in a recent notification announced that the bank has decided to provide another window to PAs as they could now apply for a licence by September 30, 2022, the RBI release said.

The banking regulator in the release has also mentioned that PAs should have a minimum net worth of Rs 15 crore as on March 31, 2022.

The RBI in its release said, “Keeping in view the disruption caused by the Covid-19 pandemic, and to ensure smooth functioning of the payments ecosystem, it has been decided to allow another window to all such PAs (existing as on March 17, 2020) to apply to the RBI.”

The PAs will now be permitted to continue their operations till they receive communication from the central bank regarding the fate of their application.

The RBI, however, said the timeline of March 31, 2023, for achieving the net worth of Rs 25 crore would remain.

In its directive, the RBI said, “It is observed that applications received from some PAs had to be returned as they had not complied with eligibility criteria, including the minimum net worth criterion of Rs 15 crore by March 31, 2021. This also implied that they have to discontinue their operations within a period of six months from the date of return of application. Though they have the option to apply afresh on meeting the prescribed criteria, ceasing operations may lead to disruption in payment systems. It is also possible that some PAs had not applied to RBI due to non-fulfilment of eligibility criteria.”

The central bank in 2020 introduced a payment aggregator framework to bring all PAs as regulated entities under the Payment and Settlement Systems Act (2007).

Under the guidelines, the PAs were mandated to obtain a licence in order to acquire merchants and to deploy digital payments solutions.

According to news reports, some payment providers such as Razorpay, Pine Labs, Stripe, 1Pay, and Innoviti Payments have received in-principle approval from the RBI for a PA licence. More platforms are also expected to get the RBI approval for a payment aggregator licence.