PayU receives RBI's in-principle approval for payment aggregator role

New Delhi, April 24, 2024

PayU can now on-board new merchants and provide them digital payment services

Fintech firm PayU has received an in-principle approval from the Reserve Bank of India to operate as a payment aggregator, the company said on Wednesday. With in-principle approval in place, PayU can now on-board new merchants and provide them digital payment services.

This will allow PayU to begin on-boarding new merchants, offering them digital payment solutions.

In January 2023, the RBI had returned the fintech firm’s application to operate as a payment aggregator due to its complex corporate structure and directed it to reapply. Following this, PayU had to pause on-boarding new merchants for its online payment aggregation business.

Anirban Mukherjee, Chief Executive Officer (CEO) of PayU said, “This licence is pivotal in our mission to establish a globally renowned digital payment infrastructure rooted in India. Aligned with the government’s Digital India initiative and the RBI’s forward-thinking regulations, we are dedicated to driving digitisation and financial inclusion, particularly for small merchants.”

What is a payment aggregator?

A payment aggregator is a financial technology company that simplifies the process of accepting electronic payments for businesses. It acts as an intermediary between the business and the financial institutions that handle payment processing, allowing businesses to avoid the complexities of establishing direct relationships with these entities.

Payment aggregators enable businesses to accept a diverse range of payment options without the upfront work, whether payment is by credit card, debit card, e-wallet, or bank transfer. This is an easy and cheap way of accepting payments that can help a small business take off quicker, as there are no waiting days or months to start transacting.

[The Business Standard]