MUMBAI: The Reserve Bank has issued revised guidelines for payment aggregators (PAs) to bolster consumer protection and combat fraud. These guidelines mandate a board-approved dispute resolution policy with clear refund timelines, robust data security, and fraud prevention systems.
Under the updated framework, PAs that facilitate customer payments to merchants via various physical or virtual channels must implement a board-approved dispute resolution policy clearly defining the timelines for processing refunds, ensuring prompt and transparent redressal of payment-related grievances.
To address growing risks of digital fraud, the RBI has also mandated that PAs must put in place data security infrastructure, along with systems for fraud detection and prevention.
In terms of financial requirements, entities seeking to operate as PAs must maintain a minimum net worth of Rs 15 crore at the time of application. This must be increased to Rs 25 crore by the end of the third financial year after authorisation. The prescribed networth must be maintained on a continuous basis to ensure operational stability, the regulator said late last night.
While banks are exempt from seeking authorisation to operate as PAs, non-bank entities must apply via the RBI's online portal. Entities regulated by other financial sector regulators must also submit a no objection certificate (NoC) within 45 days of obtaining it, the circular said further.
The new guidelines also prohibit PAs from engaging in marketplace business and restrict them to aggregating funds only for merchants with whom they have a contractual relationship. Additionally, PAs are barred from offering ATM PIN as an authentication factor for card-not-present transactions.
Further, the regulator said PAs must not impose transaction amount limits on specific payment modes. The responsibility for setting such limits lies with the card-issuing bank, based on the customer's credit profile and spending behaviour, it said.