Saturday, May 18, 2024

RBI gives Paytm more time to reapply for aggregator licence

MUMBAI : The Reserve Bank of India (RBI) has extended an earlier deadline for Paytm Payments Services Ltd to reapply for a payment aggregator licence, but has not lifted restrictions on onboarding new online merchants, parent company One 97 Communications Ltd said on Sunday. 

In November, RBI had asked the company to resubmit its application within 120 calendar days after seeking approvals for past downward investment from the company into Paytm Payments to comply with foreign direct investment norms. It had also barred the company from onboarding new online merchants.  

“…we would like to inform you that we have recently received an extension of time from RBI for resubmission of the application. The letter from RBI says that Paytm Payments Services Ltd (PPSL) can continue with the online payment aggregation business, while it awaits approval from government of India for past investment from One 97 Communications Ltd (OCL) into PPSL as per FDI guidelines,” it said on Sunday. 

As per RBI’s letter, on receipt of approval from the government, Paytm Payments will have 15 days to submit the application seeking authorization to operate as an online payment aggregator.  

“However, if any adverse decision is taken by the government, then the same shall be informed to RBI immediately,” the statement said, citing RBI’s letter. The statement added that during this process, Paytm Payments can continue with its online payment aggregation business for existing partners, without onboarding any new merchants. 

This, the company said, continues to have no material impact on its business and revenues, since the communication from RBI is applicable only to onboarding of new online merchants and it can continue to provide payment services to existing online merchants. Furthermore, for offline business, it can continue to onboard new merchants and offer them payment services including All-in-One QR, Soundbox, Card Machines, among others. 

“There are no observations in the letter other than what is mentioned above. We are hopeful of receiving the necessary approvals in a timely manner,” it said. 

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