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After nearly a year, the Reserve Bank of India (RBI) has lifted the ban on payment aggregators Cashfree and Razorpay.
With the RBI’s approval, the payment providers will be permitted to add new merchants to their online payment processing platform.
A representative for Cashfree Payments stated: Getting the RBI to grant them a Payment Aggregator (PA) license is a critical step for Cashfree Payments, reaffirming their commitment to compliance and emphasizing the value of a well-regulated payments environment.”
New merchants are currently being added to our payment gateway. They are thrilled to be entering this new stage of our business, where they hope to maintain our market leadership as the go-to aggregator in the payments industry while also fostering exponential development.
A representative for Razorpay stated: “We are committed to providing our industry-first payment solutions to new customers, and we have resumed onboarding following the issuance of the new PA license.” Being among the first payment gateways to obtain the RBI’s final PA license, we are happy to announce this important step.
The central bank requested last year that the companies that possess in-principle permits for payment aggregator licenses—Razorpay, Cashfree, PayU, and Paytm—halt onboarding new merchants until they receive the final license.
PayU India and Paytm are still seeking an explanation. PayU India stated, “We have resubmitted our application and are awaiting a decision.”
The RBI requested these aggregators to temporarily halt the onboarding of new online merchants until further documentation was presented last year. From then on, the companies and the regulator had regular conversations.
According to a representative of one of the payment aggregators, Razorpay, PayU India, and Cashfree previously held a 70–80% market share when it came to onboarding new merchant accounts.
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Since the top four have not operated for the past year, new retailers have been competing against some of the more forceful firms, like PhonePe, Infibeam Avenues, and others.
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