RBI grants in-principle approval for payment aggregator licence
Recently Reserve Bank of India (RBI) has granted Payment Aggregator license to 32 entities.
- RBI had released the Payment Aggregator Framework in 2020 to regulate payment aggregators and payment gateways.
- Under this framework, eligible entities were required to apply for authorization under the Payment and Settlement Systems Act,
- Payment Aggregators and Payment Gateways are intermediaries facilitating payments in the online space.
Payment Aggregator
- These are entities that facilitate e-commerce sites and merchants to accept different payment instruments (cash/cheque, online payments, etc.) from customers to ‘discharge’ their payment obligations.
- Payment Aggregator entities receive payments from customers, collect them and transfer them to merchants after a specified period of time.
Payment Gateway-
- These are entities that provide technology based infrastructure to facilitate the way and process of online payment transactions.
- These institutions do not have any participation in the management of the funds.
Key requirements laid down by RBI for setting up a payment aggregator
- Such entity should be a company incorporated under the Companies Act,
- The net worth of such an organization should be Rs 15 crore by March 2021 and Rs 25 crore by March
- Customer grievance redressal mechanism and dispute management framework should be set up.
- These should be publicly mentioned. Also, a nodal officer should also be appointed for these.
Source – Indian Express
