The Reserve Bank of India on Monday issued final directions for payment aggregators (PA). Under the guidelines, a bank does not require an authorisation to act as a PA, while non-banking finance companies will need approval from the RBI to carry out such operations.
The RBI had issued draft norms on April 16, 2024, proposing guidelines on proximity or face-to-face payments.
Authorisation and capital requirements
An entity seeking authorisation to commence or carry out the PA business shall have a minimum net worth of Rs 15 crore at the time of tendering application for authorisation. It must attain a minimum net worth of Rs 25 crore by the end of the third financial year of grant of authorisation.
Customer protection and compliance norms
In order to conduct business, promoters and directors of the company should clear the ‘fit and proper’ criteria as mandated by the regulator. Additionally, the RBI has urged PA to form a dispute resolution mechanism to resolve issues related to transactions and put a strong risk management system in place to prevent fraud and assure customer protection.
Under the final guidelines, a non-bank PA should maintain the funds collected on behalf of its merchants in a separate escrow account with any bank. These accounts should only be maintained for PA business. The regulator also asked entities to follow instructions with regard to the merchant discount rate.