Paytm shifts offline merchant business to subsidiary post-RBI’s PA license
In a significant development, Paytm parent One 97 Communications has completed the transfer of its offline merchants’ payment business to its wholly-owned subsidiary, Paytm Payments Services Limited (PPSL). This move comes after PPSL received the Reserve Bank of India’s (RBI) license to operate as a Payment Aggregator (PA). The approval from the RBI is a crucial milestone for Paytm, as it will enable the company to resume the onboarding of new merchants, a process that had been under an RBI freeze since November 2022.
The transfer of the offline merchant business to PPSL is a strategic decision by Paytm to comply with the RBI’s guidelines for payment aggregators. The RBI had introduced these guidelines to ensure that payment aggregators, which facilitate transactions between merchants and customers, operate in a secure and regulated environment. By transferring its offline merchant business to PPSL, Paytm is ensuring that it is in compliance with these guidelines and can continue to provide payment services to its merchants.
The RBI’s license to PPSL is a significant development for Paytm, as it will enable the company to expand its payment services to more merchants. Paytm has a large network of offline merchants, including small and medium-sized businesses, and the approval from the RBI will enable the company to resume the onboarding of new merchants. This is expected to drive growth for Paytm, as it will be able to increase its transaction volumes and revenue.
The RBI’s guidelines for payment aggregators require companies to have a separate entity for their payment aggregation business. This entity must have a minimum net worth of Rs 15 crore and must comply with the RBI’s guidelines for payment aggregators. By transferring its offline merchant business to PPSL, Paytm is ensuring that it is in compliance with these guidelines and can continue to provide payment services to its merchants.
The approval from the RBI is also a significant milestone for Paytm, as it will enable the company to expand its payment services to more merchants. Paytm has a large network of offline merchants, including small and medium-sized businesses, and the approval from the RBI will enable the company to resume the onboarding of new merchants. This is expected to drive growth for Paytm, as it will be able to increase its transaction volumes and revenue.
In addition to expanding its payment services to more merchants, the approval from the RBI will also enable Paytm to improve its services to existing merchants. Paytm has been working to improve its payment services, including its point-of-sale (PoS) machines and online payment gateway. The company has also been working to expand its services to more industries, including healthcare and education.
The RBI’s license to PPSL is also a significant development for the Indian payment industry, as it will enable more companies to provide payment services to merchants. The RBI’s guidelines for payment aggregators have created a level playing field for companies, and the approval from the RBI will enable more companies to provide payment services to merchants.
In conclusion, the transfer of Paytm’s offline merchant business to PPSL is a significant development for the company, as it will enable it to comply with the RBI’s guidelines for payment aggregators. The approval from the RBI will enable Paytm to resume the onboarding of new merchants, expand its payment services to more merchants, and improve its services to existing merchants. This is expected to drive growth for Paytm, as it will be able to increase its transaction volumes and revenue.
The development is also a significant milestone for the Indian payment industry, as it will enable more companies to provide payment services to merchants. The RBI’s guidelines for payment aggregators have created a level playing field for companies, and the approval from the RBI will enable more companies to provide payment services to merchants.
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