Hitachi Payment Services and BharatPe have acquired preliminary approval from the Reserve Bank of India (RBI) to function as payment aggregators.
As a payment aggregator, Hitachi will be able to offer its business-to-business (B2B) clients value-added services and digital payment products like EMI, PayLater, BBPS, and loyalty programmes.By expanding its market, BharatPe would be able to offer options for accepting digital payments.
Payment aggregators make it easier for businesses and e-commerce sites to accept many forms of payment from their clients. They help merchants communicate with acquirers.
The central bank has given its in-principle clearance for fintech companies like Razorpay, PineLabs, Stripe, 1Pay, Innoviti Payments, MSwipe, and Infibeam Avenues to function as payment aggregators. The central bank is anticipated to approve more businesses for payment aggregator licences.
Only businesses that the RBI has approved may purchase and provide payment services to merchants, according to guidelines released by the RBI in 2020. Banks do not require separate authorizations, however non-bank firms that provide payment aggregator services were required to apply for authorisation from the RBI by June 2021, which was later extended.
However, the central bank had given them permission to keep operating until they heard from the regulator regarding the outcome of their application. Payment aggregators that were in operation as of March 2020 were given an additional window by the RBI to submit a licence application. Payment aggregators had until September 30, 2022, to submit their licensing applications.
The requirements that must be met by the entities in order to obtain this licence have been outlined by the central bank, and while many companies have had their applications denied by the RBI, many others have received approval.
