Razorpay receives RBI approval for payment aggregator license
- The move endorses Razorpay as the country's full-stack financial platform and further reiterates the trust placed by over 8 million businesses in the platform to boost and support their business growth.
Payments and banking platform for businesses, Razorpay has received RBI's approval for a Payment Aggregator (PA) License. The move endorses Razorpay as the country's full-stack financial platform and further reiterates the trust placed by over 8 million businesses in the platform to boost and support their business growth. The companies receiving authorisation to operate as payment aggregators in India directly come under the purview of the RBI. It is mandatory for a non-bank platform to opt for license from the central bank.
To ensure the safety of merchants and consumers, in March 2022, the Reserve Bank of India (RBI) issued a payment aggregator framework stating that payment gateways will be mandated to have a license for acquiring merchants and to provide them with digital payments acceptance solutions.
RBI, Harshil Mathur, CEO & Co-founder of Razorpay, said, “We are really excited to have received our Payment Aggregator License. We at Razorpay, recognize that we have a responsibility to innovate by not just looking at the future but taking analogies from the past, and strengthening the financial ecosystem of tomorrow, so that millions of businesses, small and big can flourish. This event only further strengthens our commitment to never stop reinventing. We want to create new products and build experiences that will change the lives of millions of businesses and consumers," reported by PTI.
More than 185 fintech enterprises and startups submitted their proposals for a payment aggregator license, under the central bank's strict evaluation process.
Payment aggregators are entities that facilitate e-commerce sites and merchants to accept various payment instruments from the customers for completion of their payment obligations without the need for merchants to create a separate payment integration system of their own. PAs facilitate merchants to connect with acquirers. In the process, they receive payments from customers, pool and transfer them to the merchants after a time period.
Notably, bank and non-bank PAs handle funds as part of their activities. Banks, however, provide PA services as part of their normal banking relationship and do not, therefore, require a separate authorisation from RBI. Non-bank PAs shall require authorisation from RBI under the Payment and Settlement Systems Act, 2007 (PSSA), as per RBI direction.
Mathur added, “With the digital payments space coming under direct RBI regulation, we can expect to not only see an immense upsurge in online payment adoption and trust but also witness a magnified surge in digital payment innovations in the coming years. With this trust placed in us, we will continue building the financial backbone for businesses in India, one that is more cashless, more frictionless, more secure, and more connected.”
The license will enable Razorpay to further its vision of making digital payments easily accessible for all Indian businesses.
On the back of a sharp focus on product innovation that is designed to empower and enable uncontrolled growth for small businesses, Razorpay, has become the fastest-growing fintech in India.
Razorpay is the only payment solution in India that allows businesses to accept, process, and disburse payments with its product suite. It gives you access to all payment modes including credit card, debit card, net banking, UPI, and popular wallets including JioMoney, Mobikwik, Airtel Money, FreeCharge, Ola Money, and PayZapp.
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First Published:11 Jul 2022, 09:45 PM IST
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