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Corporate Laws Central Ministry of Finance Reserve Bank of India Act, 1934

RBI issues Reserve Bank of India (Regulation of Payment Aggregators) Directions, 2025

15-Sep-2025 | RBI/DPSS/2025-26/141 CO.DPSS.POLC.No.S-633/02-14-008/2025-26

Reserve Bank of India (RBI) has introduced a new Master Direction on Regulation of Payment Aggregator (PA) with effect from 15th September 2025. Notable Highlights of the Master Direction are as follows: 1. Applicability - The rules apply to all banks and non-bank entities acting as Payment Aggregators (PA), including online (PA-O), physical point of sale (PA-P), and cross-border (PA-CB). 2. Authorisation & Capital - Banks do not need RBI approval to operate as PA. Non-bank entities must get RBI authorisation, be incorporated in India, and meet capital requirements: minimum net-worth of Rs. 15 crores at application and Rs. 25 crores within three years. 3. Business Conduct - Must have clear dispute redressal systems, refund timelines, and proper contracts with merchants/banks. Strong risk management, fraud prevention, and IT/cybersecurity systems are mandatory. 4. KYC & Due Diligence - PAs must conduct customer due diligence (CDD) of merchants as per KYC norms of RBI, including PAN verification, address checks, and ongoing monitoring. Merchants must comply with these norms by December 2025. 5. Escrow Accounts - Non-bank PAs must keep customer payments in separate escrow accounts with scheduled commercial banks. Special rules apply for cross-border transactions with Inward (InCA) and Outward (OCA) collection accounts. 6. Reporting & Compliance - PAs must submit periodic reports to RBI (net-worth certificate, escrow account audit, cybersecurity audits, transaction statistics, etc.). Old circulars on PA/PG regulation are repealed and replaced by this Master Direction. For more information, please refer to the attached Master Direction.

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