Amazon Pay received the payment aggregator license from the Reserve Bank of India in February.
Amazon Pay, an online payment service by Amazon, is exploring offering credit services to customers via the United Payment Interface (UPI). Amazon Pay is collaborating with the National Payments Corporation of India (NPCI) for the same, as reported by the Financial Express.
Speaking to the Financial Express, Vikas Bansal, Amazon Pay India's whole-time director, said, “One of our stated objectives is to innovate in partnership with NPCI. Credit on UPI is one large initiative. So, we are very actively looking at that to see how we continue to enhance the customer experience and value proposition.”
In February of this year, Amazon Pay received the payment aggregator license from the Reserve Bank of India. The RBI data says that as of January 2024, 6.6 crore people used the wallets provided by Amazon Pay.
Amazon also provides instant credit with the help of the Amazon Pay Later option. Through this, customers can make purchases via monthly installments. Consumers can complete the one-step process and avail credit. For this ‘Buy Now, Pay Later’ option, Amazon collaborated with banks such as IDFC First Bank and Karur Vysya Bank.
The Financial Express report says that, regarding UPI transactions, there have been doubts about the interchange fee structure. Further low adoption by small merchants has led to reduced growth in UPI transactions. Thus, Bansal feels that the merchant discount rate should be made in such a way that it helps everyone. As per the report, Bansal said, ““If the MDR is too high, the merchant ecosystem will hurt while banks will benefit. So, I think you need to put it in a way that it offers incentives for all players in the ecosystem.”
“We have been processing or serving both customers and merchants for a very long time. This licence validates our strategy and approach. We will use the license to expand our value proposition,” Bansal added, as per the report.