Bengaluru-based fintech startup Open has achieved a significant milestone with the final approval from the Reserve Bank of India (RBI) to operate as a Payment Aggregator/Payment Gateway (PA/PG). This green light follows the in-principle nod granted by the RBI in 2022.
Anish Achuthan, Co-founder and CEO of Open, expressed his enthusiasm about the approval, stating, “We are elated to receive the Payment Aggregator/Payment Gateway licence from the RBI.” This recognition not only validates the company’s commitment to regulatory standards but also marks a substantial step in strengthening its dedication to small and medium-sized enterprises (SMEs).
Empowering SMEs in the Digital Era
This regulatory approval allows Open to enhance its financial automation platforms, providing SMEs with advanced tools to streamline their financial operations. Achuthan emphasised, “The enhanced capabilities will bolster our financial automation platforms, providing SMEs with advanced tools to streamline their financial operations and thrive in the digital era.”
RBI’s Focus on Regulatory Oversight
The Reserve Bank of India actively regulates digital banking platforms to safeguard customers and enhance the security of financial services. Stringent guidelines, including restrictions on lending through prepaid payment instruments and close supervision of licence issuances, aim to achieve these goals.
Lifted Embargo on Razorpay and Cashfree
In a recent development, the RBI lifted a year-long embargo on Razorpay and Cashfree Payments, allowing these companies to resume their online payment aggregator operations and onboard new merchants. Achuthan expressed gratitude, saying, “We are grateful to the RBI for their evaluation and recognition of our contribution.”
Open’s Journey and Commitment to SMEs
Founded in August 2017, Open focuses on assisting small businesses with cash flow management, automating accounting processes, and accessing credit lines. In May 2022, the company raised $50 million in a Series D round, making it India’s 100th unicorn. Notable investors in this round include IIFL, Temasek Holdings, Tiger Global Management, and 3one4 Capital.
