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The Reserve Bank of India (RBI) has made it compulsory for payment aggregators to obtain prior licences in order to operate. Introducing new rules for such entities, the banking regulator has mandated companies to must have a minimum net worth of Rs 25 crore within three years in order to qualify for payment regulator licences.

The new norms come at a time when digital transactions are growing rapidly in the country, with the central bank stepping up vigilance to ensure greater transparency, financial stability and security in the domestic banking and payments  system.

This marks an increase of Rs 10 crore over the current threshold. Currently, the minimum requirement stands at Rs 15 crore. 

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Those engaged in such businesses will have to submit their applications mandatorily by December 31, according to the RBI.

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Any violation in this regard will lead to closure by February 28, 2026.

Additionally, the central bank has set a limit of Rs 25 for cross-border transactions. In other words, inward and outward fund transfers using such platforms will be subject to a transaction limit of Rs 25 lakh, as per the new rules.

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Any transactions above this limit will be kept safely in escrow accounts, according to the regulator. 

What has changed?

Area

Existing rules

New rules

Licence Requirement

New entrants had to obtain RBI authorisation

Existing players could continue temporarily while applying

Licence compulsory for all payment aggregator

No operation without approval

Net Worth Requirement

Rs 15 crore minimum net worth

This must be achieved by March 2021 and maintained

Rs 15 crore minimum to start

This must reach Rs 25 crore within 3 years

Application Deadline

Multiple extensions were given for existing players to apply (latest being Sep 2022 for some)

Mandatory submission of applications by December 31

Non-Compliance

Non-compliant entities risked rejection but often had grace periods

Must shut down operations by February 28 if not compliant

Cross-Border Transactions

No clear upper limit defined by RBI

Limit set at Rs 25 lakh per transaction

Escrow Mechanism

Escrow accounts required, but rules were less detailed

Stricter enforcement

Money must be kept safe in escrow

Cybersecurity

General IT security guidelines under RBI

Annual cybersecurity audit compulsory

Cybersecurity in the spotlight 

The RBl has also made it compulsory for payment aggregators to undergo annual cybersecurity audits in order to protect user interests. 

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