The Reserve Bank of India (RBI) has brought under its direct regulation all entities facilitating cross-border payments for import and export of goods and services. Such entities will be termed as Payment Aggregator-Cross Border (PA-CB)
Further, the central bank has prescribed networth criteria for non-banks providing PA-CB services, as per its circular ‘Regulation of PA - Cross Border’, addressed to all payment system providers and payment system participants.
PAs-CB facilitate cross-border online payments for import and export of permissible goods and services.
The RBI said Authorised Dealer (AD) Category-I banks do not require separate approval for PA-CB activity.
Non-banks providing PA-CB services as on the circular date (October 31) must apply to the RBI for authorisation by April 30, 2024; they will be allowed to continue such services until the RBI decides on their application.
Authorisation for PA-CB activity may be sought for one of three categories — export-only PA-CB, import-only PA-CB, and export and import PA-CB.
As a prerequisite to seeking RBI authorisation, all non-bank PA-CBs (existing as on the date of circular) must register with the Financial Intelligence Unit-India (FIU-IND).
Networth criterion
The RBI said non-banks providing PA-CB services as on the date of circular should have a minimum networth of ₹15 crore at the time of application for authorisation and a minimum networth of ₹25 crore by March 31, 2026.
New non-bank PA-CBs (that is, entities which have not commenced operations before the date of the circular) should have a minimum networth of ₹15 crore at the time of applying I for authorisation and ₹25 crore by the end of the third financial year of authorisation.
The RBI said all existing non-bank PA-CBs that cannot comply with the networth requirement or fail to apply for authorisation within the stipulated time frame, shall wind up PA-CB activity by July 31, 2024.
If the per unit goods/ services imported exceeds ₹2.5 lakh, then the PA-CB concerned must undertake due diligence of the buyer also, the RBI said.
Customer due diligence should be undertaken by the merchant (that is, directly onboarded Indian merchants, e-commerce marketplaces, or entities providing PA services), and proceeds from the Export Collection Account (ECA) shall be settled only in the account of such merchants.