Overview
- The Reserve Bank of India issued the Reserve Bank of India (Regulation of Payment Aggregators) Directions, 2025, creating a single framework that takes immediate effect and formally classifies entities as PA‑P (physical), PA‑O (online) and PA‑CB (cross‑border).
- Banks may operate as payment aggregators without separate approval, while non‑bank players must obtain RBI authorisation, meet net‑worth thresholds of Rs 15 crore at application and Rs 25 crore by the end of the third financial year, apply by December 31, 2025, and risk wind‑down by February 28, 2026 if non‑compliant.
- Funds collected for merchants must be kept in escrow with scheduled commercial banks, with strict permitted credits and debits, T+1 settlement timelines, segregation of domestic and cross‑border flows via dedicated accounts, prohibition on cash‑on‑delivery use, and interest allowed only on the core portion of domestic balances.
- Governance and customer‑protection rules require fit‑and‑proper promoters and directors, robust merchant due diligence and KYC with simplified checks for small merchants, allowance for agent‑assisted verification under PA accountability, FIU‑IND registration, a nodal officer for grievances, and a board‑approved dispute‑resolution framework.
- Security mandates include annual audits by CERT‑In empanelled auditors and immediate cyber‑incident reporting, while PA‑CBs must keep inward and outward funds separate, avoid foreign‑exchange dealing except through authorised dealers, observe a per‑transaction cap of INR 25 lakh, and may directly onboard foreign merchants for outward payments.