March 18, Mumbai: The Reserve Bank of India (RBI) on March 17, 2020 issued guidelines which include regulating the entire activities of the Payment Aggregators (PA) as well as to provide baseline technology-related recommendations to Payment Gateways (PGs). “PAs 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,” said RBI in a circular.
The apex bank has reduced the capital requirements during the application for the license from Rs 100 crore earlier to Rs. 15 crore. “PAs existing as on the date of this circular shall achieve a net-worth of Rs15 crore by March 31, 2021 and a net-worth of Rs 25 crore by the end of third financial year, on or before March 31, 2023. The net-worth of Rs 25 crore shall be maintained at all times thereafter,” said RBI. Further the PAs that are not able to comply with the net-worth requirement within the given time frame would have to wind-up their payment aggregation business.
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The RBI would also check ‘fit and proper’ status of the applicant entity as well the management through inputs from other regulators, government departments etc. On the other hand, PAs are also required to disclose comprehensive information regarding merchant policies, customer grievances, privacy policy and other terms and conditions on their website and on their mobile application. “PAs shall undertake background and antecedent checks of the merchants, to ensure that such merchants do not have any malafide intention of duping customers, do not sell fake / counterfeit pages/ prohibited products. The merchant’s website shall clearly indicate the terms and conditions of the service and time-line for processing returns and refunds,” said RBI in a statement.
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