The rapidly changing payment ecosystem calls for a regulatory body that can govern and make the system secure. Reserve Bank of India – Approved Payment Aggregator sets up the guidelines and security regulations for flawless transactions.
RBI monitors and keeps an eye on India’s digital payment network. Payment aggregators and gateways play an important role in online payment, and these intermediaries have skyrocketed the number of card transactions over the past few years. Therefore, the Reserve Bank of India has put forward these guidelines to ensure utmost security and convenience.
To build trust and safety in the fintech marketplace, payment aggregators have set up online identity verification and enforced multiple authentication across all accounts. Moreover, link analysis is done by these bodies to detect fraud and scams. Data Encryption and Biometric Verifications have been set up to build the trust of the users since they want to use the technology and make the payment scenario hassle-free, but not at the cost of data breaches or cyber crimes.
The e-commerce businesses and users can streamline their e-transactions with their payment modes, but must be aware of what comes along. Even though several setups have been done by the government to prevent fraudulent activities and build safe spaces, the users need to make informed decisions before using a gateway.
What Are RBI-Approved Payment Gateways?
With technology booming and digitalization becoming the norm, every industry demands efficient use of tech tools to simplify their cumbersome processes. In the Finance Technology Spectrum, payment gateways have provided relief to users. Hold on! Are you wondering what a Payment Gateway is? Here’s the spill!
Payment Gateway can be defined as an intermediary or a digital service that can perform online transactions through various payment modes like credit card, debit card, UPI, digital wallets, etc. It bridges the payment gap between the two bodies in a secure manner.
After Covid-19, the world has experienced social distancing, and so people have widely adopted the method of cashless transactions in India. This electronic mode of exchange of money raised a few concerns and risks regarding security. This is where a third regulatory body, the Reserve Bank of India, comes into the picture. It regulates and supervises the payment providers in the realm of virtual transactions.
Objectives of the Payment and Settlement Act, 2007
-The foremost objective of PSS 2007 was to regulate and supervise the payment systems. These systems included:
- Debit and Credit Cards.
- Electronic Fund Transfer (NEFT, IMPS, RTGS)
- Mobile Payments (Digital Wallets and UPI)
– Appointing the RBI as the governing body to manage the payment landscape.
– Minimize the systemic risks.
Payment Aggregator Guidelines by RBI
- The Payment Aggregator banks will not require any authorization. For non-bank PAs, after the authorization, the instructions will be valid.
- For a non-bank PA to exist, a CA certificate will be required for the net worth, but for banks that have escrow accounts, net worth should not be tracked.
- There is a ‘fit and proper’ criterion of the Reserve Bank; a Payment Aggregator must conform to this criterion, and the Director shall conform as a “fit and proper” person.
- A PA that maintains an account-based relationship with the merchant is required to carry out KYC following DoR guidelines.
- The PA must ensure that the merchant infrastructure follows the security standards, like PCI-DSS and PA-DSS.
RBI Guidelines for Payment Gateways
The RBI has issued guidelines for the Payment Aggregators ( PA) and Payment Gateways (PG) to undergo safe and secure transactions. PA and PG are truly important in enabling online transactions.
PA/PG Status
Bank and Non-Bank PAs handle the funds, and so PAs must be incorporated under the Companies Act. Non-bank entities must apply for authorization. PG shall be considered as a “technology partner” or an “outsourcing partner” to the banks and non-banks.
Net Worth of PA/PG
A PA must maintain a net worth of ₹25 crores at all times. New applicants should have a net worth of ₹15 crores when applying. The net worth shall include equity capital, share premium account balance, free reserves, surplus amounts, and funds.
Governance
Every PA promoter shall ensure that the “fit and proper” criteria are met as defined by the RBI. In case of any changes in the management of the non-PA bank, it shall be communicated to the Chief General Manager at the RBI office. PA is required to disclose all the information about the merchants on their mobile application.
KYC Provisions
The RBI guidelines issued regarding KYC (Know Your Customer), Anti-Money Laundering (AML), and Combating Financing of Terrorism (CFT) must be updated from time to time.
PCI DSS & data security compliance
PA is responsible for checking Payment Card Industry-Data Security Standard (PCI-DSS) and Payment Application-Data Security Standard (PA-DSS) compliance of the infrastructure of the merchants that have to be onboarded. It must also have a Board-approved policy for onboarding merchants.
Grievance redressal mechanisms
The customer disputes and grievances shall be made publicly available by the PA, and there must be a designated officer who will handle these complaints and escalations.
Escrow account requirements
The collection of amounts of Non-bank PA must be done in an escrow account. Escrow accounts must not be operating on Cash-on-Delivery. If there’s a need to transfer the escrow account from one bank to another, it must not affect the payment cycle of merchants.
13 Best RBI-Approved Payment Gateways in India
To embrace the online space for making digital payments, there’s a need for the right facilitator that is RBI-approved. It not only makes your transactions flawless but also keeps them secure and safe. Some of the Best RBI-approved payment gateways in India are mentioned here.
1. Razorpay
Razorpay, being the industry’s leading platform, performs millions of transactions every day. It is capable of detecting fraud, and so is the hero. This automated finance platform is a top choice of customers, from naive users to large-scale businesses. It provides end-to-end solutions and is built to enhance the online banking experience.
2. Cashfree Payments
Cashfree Payments processes around $80 billion annually and is a top choice for a payment gateway, as it has simplified the banking infrastructure. With its capability to be integrated with a range of platforms like Shopify, Wix, WhatsApp, etc, it has gained huge success. The payment gateway keeps seizing new opportunities every day to become a business leader.
3. PayU
Providing total flexibility in payment modes, PayU manages your money efficiently. It has enhanced features to keep track of the cash inflows and outflows, and manage your data with unparalleled experiences. The no-code payment solution is used by industry leaders like shaopaholic.com, sanskritiias.com, voltas.com, and many more.
4. CCAvenue
CCAvenue is a promising payment gateway in the country. It is a unified platform that accepts multiple currencies for processing, including all 27 major currencies in the world. CCAvenue has a high payment success rate, and it beautifully complements your business payment needs.
5. BillDesk
BillDesk celebrates its 25 years of success in 2025. Being one of the oldest online payment solutions, has been associated with SBI, HDFC, VodafoneIdea, LIC, AmazonPay, and more in the past. It is a stalwart performer and a veteran player in the industry since it was adopted by large businesses and government agencies.
6. Paytm Payment Gateway
The predominant payment gateway, Paytm, can handle more than ten thousand transactions every second. With 99.99% uptime, it is associated with brands like Flipkart, Uber, Zomato, Airtel, Myntra, etc. Paytm can be easily integrated into your application with the help of a developer for a safer checkout with payment. Chalo, Paytm Karo!
Also Read: How To Build a PayPal-Like App Development
7. PhonePe Payment Gateway
Are you looking to get easy payment solutions for your business? PhonePe will provide you with an unmatched experience and will perform all the transactions securely and in a few seconds. It has extensive support for languages like iOS, PHP, Java, Android, React Native, and Python.
8. Juspay
Juspay opens source payment orchestration in India. The payment gateway not only accelerates your growth by 10 times but also provides pioneering customer experiences through its solutions.
9. Worldline India
Worldline India helps you in performing payments of all sizes. It is one of the well-known online transaction gateways and helps you boost conversion rates. This trusted payment partner has helped a lot of firms achieve their financial goals by increasing efficiency.
10. Open Money
Considered as the easiest option to make payments, the open money gateway has simplified a lot of invoicing and bill payments. It has helped businesses transfer funds to partners effortlessly. The automated process has reduced 80%of manual payments and 25% reconciliation tasks.
11. MobiKwik
MobiKwik has been a widely adopted gateway for individual users and business categories. Initially, MobiKwik was a Digital Wallet, which then evolved into a payment gateway. It supports a wide range of payments and can be integrated with platforms like WordPress, Magento, etc.
12. Stripe
The payment processor Stripe handles complex payments by allowing multiple ways to accept financial transactions. It records 11.9% revenue uplift and is integrated with Amazon, Figma, H&M, and Airbnb. It provides encryption and PCI compliance for safe payments.
13. Resilient Payments Private Limited
Resilient Payments Private Limited is a BharatPe Group and will majorly work to upscale the online transaction model in Tier-2 and Tier-3 cities. The brand purpose is to ease the payment scenario in business, and as a user of the industry solutions.
Conclusion
If you are a business leader or have installed footprints as a startup in the Indian ecosystem, selecting an RBI-approved payment gateway will help you in the long run. Coping with fraud detection, security compliance, and delivering excellent customer experiences has to be a top priority.
Jumping off to selecting any of the above payment gateways should also focus on the pricing part, code available for the developers for integrating, and the ecosystem capability. Authenticity is the key, and so choose the Best RBI-approved payment gateway for your business. Also, ask for a guide from your mobile application development company to help you with the best platform.
Reference – Guidelines on Regulation of Payment Aggregators and Payment Gateways
