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Payment aggregators seeking new revenue streams a year after RBI ban

5 Dec 2023

RBI banned new merchant acquisition for Paytm in November 2022, Razorpay and Cashfree in December 2022, and PayU in January 2023.

It’s been a year since RBI banned new merchant acquisitions for payment aggregators (PAs) like Paytm, Razorpay, Cashfree, and PayU. These fintech giants were asked to reapply for the Payment Aggregator (PA) license. Merchant onboarding is the major earnings generator for these companies. None of them expected the embargo to last for a year.

The inability to monitor and control access to sensitive data and improper audits triggered the ban. The regulator is minutely scrutinizing the PAs who have reapplied for the license. In September 2023, RBI asked the fintech industry to form a self-regulatory authority.

New entrants like CCAvenue and Pine Lab's Plural are heavily acquiring merchants, eating away their market share. Looking for other revenue means, Razorpay launched new value adds for the payments and D2C channel. Paytm shifted focus to offline merchant transactions done through NFC and QR codes. PayU turned to existing merchant transactions and Wibmo subscriptions.

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