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JC - Legal Updates - Facilitating Cross Border Payment Transactions? Advent of New Regulations for Payment Aggregators

Legal Updates

08 Nov 2023

Facilitating Cross Border Payment Transactions? Advent of New Regulations for Payment Aggregators

Brief Overview:
The RBI has issued new regulations titled ‘Regulation of Payment Aggregator – Cross Border (PA - Cross Border)’ (“Regulations”) in order to bring all entities facilitating cross-border payment transactions for import and export of goods and services under direct regulation of the RBI. Such entities shall hereinafter be referred to as “PA CBs".
Technical Details:
1)   All PA - CBs are compulsorily required to obtain authorisation from the RBI; existing non-bank PA-CBs have been given time till 30th April 2024 to apply for such authorisation.
2)   The RBI has also issued new net worth requirements for PA CBs:
(a)  Existing non-bank payment aggregators will need to have a minimum net worth of INR 150,000,000/- at the time of applying for authorization and a minimum net worth of INR 250,000,000/- by 31st March 2026.
(b)  New non-bank PA-CBs must have a minimum net worth of INR 150,000,000/- at the time of submitting application to the RBI for authorisation and shall attain a minimum networth of INR 250,000,000/- by end of the third financial year of grant of authorisation.
(c)  Upon non-compliance with the above requirements, PA-CBs shall wind up PA-CB activity by 31st July 2024.
3)   Import only PA-CBs shall maintain an Import Collection Account (“ICA”) with an authorised dealer category-I scheduled commercial bank (“AD Bank”).
4)   Export only PA-CBs shall maintain Export Collection Account (“ECA”), denominated in Indian Rupees (INR) and / or foreign currency, with an AD Bank.
5)   The maximum value per unit of goods or services that can be sold or purchased PA-CB transactions is INR 2,500,000/-.
6)   All PA-CBs must undertake customer due diligence of merchants and ensure that they do not facilitate payment transactions for import / export of restricted / prohibited goods and services.
7)   AD Banks maintaining ICA / ECA for PA-CB transactions must ensure that all requirements under FEMA, including for reporting and reconciliation of entries in EDPMS / IDPMS, are adhered to.
For further details, please see:                           
Regulation of Payment Aggregator - Cross Border (PA - Cross Border)
For any queries / clarifications, please feel free to ping us and we will be happy to chat:

●   Mr. Ankit Sinha (ankit.sinha@jclex.com)
●   Mr. Saurabh Sharma (saurabh.sharma@jclex.com)
●   Ms. Rupul Jhanjee (rupul.jhanjee@jclex.com