RBI lifts bar for RazorPay, Cashfree to operate as payment aggregators

5 months ago 53

Dec 19, 2023 09:06 PM IST

A spokesperson for Razorpay said the firm has received the final authorisation from the Reserve Bank of India to operate as payment aggregator under the Payment Settlements Act

NEW DELHI: The Reserve Bank of India has authorised RazorPay and Cashfree to resume operations as online payment aggregators, ending the yearlong embargo on the two fintechs from onboarding new merchants.

A security official walks past an emblem of the Reserve Bank of India at the RBI headquarters, in Mumbai (PTI FILE)

In its communication to the companies, RBI asked the two firms to report “every unusual incident, including those involving cyber-attacks, outage of critical systems/infrastructure, internal fraud, settlement delays, etc.” within 24 hours of the incident to the central bank’s Department of Payment and Settlement Systems.

IPL 2024 Auction is here! Catch all the updates LIVE on HT. Join Now

“RazorPay has now received the final authorisation from the Reserve Bank of India (RBI) to operate as a Payment Aggregator (PA) under the Payment Settlements Act, 2007. Having received the new PA license, we now restart onboarding new customers,” a spokesperson for RazorPay said. Cashfree echoed the same sentiment on its official LinkedIn page.

The central bank restricted RazorPay from onboarding new merchants on December 13, 2022.

“Securing the Payment Aggregator (PA) license from the RBI is a pivotal moment for Cashfree Payments, affirming our focus on compliance and highlighting the significance of a well-regulated payments landscape. We are now onboarding new merchants on our payment gateway,” a spokesperson for Cashfree Payments said.

A spokesperson for PayU said that the company is still awaiting a response from RBI on its application.

In September 2022, the Enforcement Directorate (ED) raided offices of RazorPay, Paytm, Cashfree and PayU across the country in connection with an FIR filed in Bengaluru related to Chinese fake loan apps. Subsequently, RBI restricted the companies from onboarding new merchants and asked them to reapply for a fresh payment aggregator.

Unlock a world of Benefits with HT! From insightful newsletters to real-time news alerts and a personalized news feed – it's all here, just a click away! -Login Now!