Payment platforms Razor pay and Cash free have received a notice from the RBI to withhold accepting new merchants to the platform. Razor Pay is an online payment platform just like Google pay and Paytm. It helps processes online payments for online as well as offline businesses. Razor Pay allows you to accept credit cards, debit cards, NetBanking, wallet, and UPI payments with the Mobile App integration. It uses a seamless integration, allowing the customer to pay on your website without being redirected away.
As per reports, Razorpay and Cashfree Payments have received notices from the Reserve Bank of India (RBI) to withhold onboarding any new online merchants to their platforms, pending their audit for the payment aggregator/payment gateway licenses. The ban will be in effect only until the two companies submit an audit report to the RBI showing they have complied with its rules and regulations for the payment aggregator/payment gateway (PA/PG) license
.
Razor Pay has confirmed that it has received the notice, saying "As part of the process for the final authorisation of our PA/PG license for which we received the in-principle approval from RBI in July, we are now required to share additional details with RBI to aid in the final license process. As part of this process, RBI has suggested we temporarily withhold onboarding new online merchants till such details are submitted".
"We would like to emphasize that this has no impact on Razorpay’s existing business operations and current merchants." The company statement also added that this does not affect Razor pay X, Corporate Card, and offline payments via Eze tap.Experts speculate that. these processes are part of the RBI's audit process for any sort of license, and that if the companies had not received these yet, it still could as the process goes on. This isn't an aberration or out of the ordinary; these are periodic processes, and we can expect to hear more companies (who are completing the audit process for the PA/PG license) in the coming weeks facing similar, temporary restrictions.
Razorpay is likely to submit its audit report to the regulator as early as next week, and the embargo could be lifted in a couple of weeks.Razorpay is likely to submit its audit report to the regulator as early as next week, and the embargo could be lifted in a couple of weeks.
These restrictions are not likely to have any physical effect on the companies, and are part of the audit process. The suspension of merchant onboarding is only for audit purposes, and for the RBI to do its due diligence before granting the companies their PA/PG license.
