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PhonePe, Paytm, CRED Halt Credit-Card Rent Payments After RBI Tightens PA Rules

New directions confine aggregators to contracted, KYC‑verified merchants, blocking transfers to landlords who are not onboarded as merchants.

Overview

  • RBI’s September 15 master directions bar payment aggregators from operating as marketplaces and require them to aggregate funds only for merchants with whom they have contractual relationships.
  • PhonePe, Paytm and CRED have switched off rent payments via credit cards, with users now directed to traditional options like bank transfers or cheques.
  • Tenants lose reward points and the credit period benefits that made card-based rent payments popular, affecting monthly cash‑flow strategies for many users.
  • Industry sources cite the cost and complexity of re‑KYCing landlords as the reason for pausing services, and say the regulator is expected to meet firms to seek feedback.
  • The rulebook also sets fresh authorisation and capital norms for non-bank PAs, including applying by December 31 and meeting net‑worth thresholds of INR 15 crore rising to INR 25 crore; the segment had been lucrative with 1–2% convenience fees as banks already pared rewards in 2024.