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PhonePe, one of India’s leading digital payment platforms, has received the final authorisation from the Reserve Bank of India (RBI) to operate as an online payment aggregator. This crucial regulatory approval unlocks new growth opportunities for the company, enabling it to expand payment services to a broader range of merchants, with particular focus on the underserved small and medium enterprises (SMEs) segment across India. The RBI nod marks a significant milestone for PhonePe’s ambition to deepen financial inclusion and digital adoption nationwide.
Key Highlights of the RBI Authorization
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Final regulatory clearance given by RBI empowers PhonePe to function independently as a payment aggregator, managing secure and seamless payment processing.
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PhonePe’s authorization facilitates expansion into online merchants nationwide, improving digital payment accessibility for SMEs, a key engine of India’s economy.
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The company’s payment gateway platform offers instant onboarding with developer-friendly plug-ins and applications, ensuring fast deployment for merchants and higher payment success rates.
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PhonePe processes over 360 million transactions daily and serves 650 million+ users and 45 million+ merchants, demonstrating its vast digital payments footprint.
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Yuvraj Singh Shekhawat, Chief Business Officer for Merchant Business at PhonePe, highlighted that the authorization accelerates financial inclusion by servicing businesses previously underserved by digital payment infrastructure.
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The nod reflects RBI’s emphasis on secure, reliable payment frameworks through escrow accounts and contract compliance, enhancing trust in India’s digital transaction ecosystem.
Expanding Digital Payment Infrastructure for SMEs
PhonePe’s new status as an authorized payment aggregator allows it to solidify its role as a key enabler of India’s digital economy. By focusing closely on SMEs, the company aims to bring these traditionally offline businesses into the digital fold, helping them leverage technology to increase revenues through smoother payment collection and customer reach. Instant onboarding capabilities paired with a robust and secure gateway offer a frictionless experience for merchants integrating payment solutions on their platforms.
Context and Market Impact
This development coincides with RBI’s reinforced regulatory framework around payment aggregators and gateways issued recently, aiming to tighten compliance norms involving KYC, escrow management, and operational accountability. It also follows fintechs like PhonePe adjusting certain offerings such as rent payment services in response to updated RBI guidelines, illustrating the changing landscape of India’s fintech regulation.
For PhonePe, the final authorization is timely as it prepares for a possible initial public offering (IPO) in the near future, signaling confidence in its business model and growth trajectory within India’s competitive fintech ecosystem.
The authoritative nod cements PhonePe’s position among India’s digital payments leaders, reinforcing its mission to broaden digital payments acceptance, especially among small businesses, thereby championing financial inclusion at a large scale.
Source: Reuters, Economic Times, CNBC TV18, Rediff Money Desk – News
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