MobiKwik’s payment gateway arm, Zaakpay, has received in-principle authorization from the Reserve Bank of India (RBI) to operate as a payment aggregator. This approval enables Zaakpay to onboard new merchants, facilitating seamless online payment processing.
Understanding Payment Aggregators
In 2020, the RBI introduced guidelines distinguishing between payment gateways and payment aggregators. Payment aggregators handle funds and facilitate payments to merchants, whereas payment gateways provide the technology platform without involving themselves in fund settlements. To operate as a payment aggregator, entities must obtain RBI approval. (livemint.com)
Zaakpay’s Journey to Approval
Zaakpay’s path to obtaining this authorization was not without challenges. The company initially applied for the payment aggregator license in 2021 but faced rejection due to not meeting the minimum net worth requirement of ₹15 crore, as its net worth stood at ₹14.3 crore at that time. After infusing additional capital, Zaakpay reapplied in October 2022 and has now secured the RBI’s nod. (inc42.com)
Implications for MobiKwik and the Digital Payments Landscape
This approval is a significant milestone for MobiKwik, positioning Zaakpay to expand its merchant base and enhance its role in India’s digital payments ecosystem. Upasana Taku, Chairperson, Co-founder, and COO of MobiKwik, expressed enthusiasm about the development, stating, "We are happy to welcome new merchants onto the Zaakpay platform and offer them a safe and user-friendly payment gateway." (livemint.com)
The authorization comes at a time when the digital payments sector in India is experiencing rapid growth. According to a report, the Indian payment gateways market is projected to grow to $2.68 billion by 2027. (inc42.com)
Zaakpay’s Offerings and Market Presence
Zaakpay provides a comprehensive suite of payment solutions, including over 100 payment methods such as UPI, debit and credit cards, net banking, and mobile wallets. The platform collaborates with various brands across sectors like e-commerce, mobility, and bill payments, ensuring a versatile solution for businesses. (business-standard.com)
Security and Compliance
Emphasizing security, Zaakpay implements multiple layers of encryption, system-level firewalls, and adheres to global standards to protect users’ financial information. (currentaffairs.adda247.com)
Conclusion
The RBI’s in-principle approval for Zaakpay to operate as a payment aggregator marks a pivotal moment for MobiKwik. It not only enhances Zaakpay’s capabilities but also contributes to the broader digital payments landscape in India, offering merchants and consumers more secure and efficient payment solutions.
