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RBI Releases Draft Guidelines for Payment Aggregator Regulation; View Details Here

With the aim of strengthening the payment ecosystem, the Reserve Bank of India released draft recommendations for payment aggregator rules on April 16.

The RBI stated that the current directions on PAs are proposed to be updated and cover, among other things, merchant KYC and due diligence, operations in escrow accounts, and are intended to strengthen the payment ecosystem. This is because of the growth in digital transactions and the significant role that PAs play in this space.

The physical point-of-sale operations of payment aggregators (PAs) are also included in the draft.

Online PAs and PAs that enable in-person or close proximity payments are part of India’s payment ecosystem.

for KYC and due diligence, the draft said that payment aggregators should follow the guidelines in the Master Directions on Know Your Customer (MD-KYC), 2016 for Customer Due Diligence (CDD) when onboarding merchants.

The draft, on which the RBI has requested feedback by May 31, 2024, said that “PAs shall ensure that marketplaces onboarded by them do not collect and settle funds for services not offered through their platform.”

The draft said that, starting on August 1, 2025, no party in the card transaction/payment chain—aside from card issuers and/or card networks—shall hold the Card-on-File (CoF) data for in-person or close-quarters card payments.

The proposal also said, “Any such data stored previously shall be purged.”

Additionally, according to the draft, non-banks offering PA-P services must have a minimum net value of Rs. 15 crore when they apply for RBI authorization and a minimum net worth of Rs. 25 crore by March 31, 2028.

After that, the net value of Rs 25 crore would always be maintained.

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