The Reserve Bank of India (RBI) has withheld Paytm’s application to provide payment aggregator service for online merchants.
The financial services company stated that Paytm Payments Services Limited (PPSL), a 100% subsidiary of Paytm, now has to resubmit its application for authorization to provide payment aggregator service within 120 calendar days.
To comply with RBI standards, the company will also seek authorization for a downward investment in PPSL. During this process, no new merchants will be accepted.
According to the company, the subsidiary will keep doing business with existing merchants for whom the services will remain unaffected.
“This has no material impact on our business and revenues since the communication from RBI is applicable only to the onboarding of new online merchants. We can continue to onboard new offline merchants and offer them payment services including All-in-One QR, Soundbox, Card Machines, etc.,” Paytm noted in a filing with BSE.
The business added that it is optimistic that, after resubmitting the application, it will be promptly approved.
