Amazon Pay get RBI's payment aggregator license; see details

Amazon Pay, the financial technology division of e-commerce giant Amazon, has secured the esteemed payment aggregator (PA) license from the Reserve Bank of India (RBI), marking a significant milestone in its operations.

The regulatory approval, granted on February 20, permits the payments platform to function as a payment aggregator, empowering it to facilitate e-commerce transactions through its application.

This announcement comes amidst a wave of licensing approvals, with 10 companies receiving the coveted license since the onset of 2024. Among the recipients are prominent entities such as food aggregators Zomato, Juspay, Decentro, Mswipe, Zoho, and Stripe, highlighting the burgeoning landscape of fintech innovation in India.

A payment aggregator license allows a company to operate as an intermediary between merchants and payment processors or banks. Essentially, it enables the aggregator to accept payments on behalf of multiple merchants, consolidate them, and then distribute the funds to the respective merchants. This model is often used by businesses that operate online marketplaces or platforms where multiple sellers offer goods or services. The license ensures regulatory compliance and typically involves meeting certain financial and security standards set by relevant authorities.

In addition to the PA license, Amazon Pay already holds a Prepaid Payment Instruments (PPI) license, enabling it to operate its wallet services, including Amazon Pay balance: Money, as outlined in RBI documentation.

Expressing dedication to enhancing user experiences, an Amazon Pay spokesperson stated, "We remain committed to simplifying lives and fulfilling aspirations of merchants and customers. This (license) allows us to further strengthen our distribution channels and deliver innovative solutions for our merchants and customers across India, providing them with secure, convenient, and rewarding digital payment experiences."