This was announced by the Reserve Bank of India (reserve Bank of India) Governor today. As per the announcement made, “Payment Aggregators (PAs) play an important role in the payments ecosystem and hence they were brought under the rules in March 2020 and named as Payment System Operators (PSOs). However, the existing rules PAs are applicable to processing. Online or e-commerce transactions. These regulations do not cover offline PAs which handle proximity/ face-to-face transactions and play a vital role in the proliferation of digital payments. To be done by online and offline PAs. Keeping in view the uniform nature of PA activities, it is proposed to extend the existing regulations to offline PAs as well. This measure would bring in synergy in regulation covering the activities and operations of PAs besides convergence on standards for data collection and storage. is expected. Detailed instructions will be issued separately.”
Adil Shetty, CEO, BankBazaar.com says, “The framework for online PSOs requires them to exercise due diligence, implement sound and responsive risk management practices for effective monitoring and manage the risks arising from such outsourcing of activities. Considering the similar nature of activities carried out by online and offline PAs, these guidelines are now being extended to offline PAs as well. Although detailed instructions are still awaited, it is expected that a common framework for data collection will bring about a convergence on the standards of and storage between online and offline PA activities and operations.”
While detailed instructions are awaited, this implies that such offline aggregators will now have to comply with the following:
1. Payment aggregators will not store Customer Card credentials in their database or servers accessed by the Merchant. They will comply with the data storage requirements applicable to Payment System Operators (PSOs).
2. Payment aggregators shall ensure that the extant instructions regarding Merchant Discount Rate (MDR) are being followed. The details of other charges like convenience fee, handling fee, etc., if any, will also be displayed by the payment aggregators.
3. Payment aggregators will not place a limit on the transaction amount for a particular payment mode. The responsibility for this will lie with the issuing bank / institution; For example, the card issuing bank will be responsible for placing amount limits on the cards issued by the customer based on his creditworthiness, spending nature, profile etc.
4. Payment aggregators will not substitute ATM PIN as a factor of authentication for card-not-present transactions.
5. All refunds will be made in the original mode of payment unless specifically agreed by the customer to credit in the alternate mode.
6. They will create a formal, publicly disclosed customer grievance redressal and dispute management framework, including designating a nodal officer to handle customer complaints/complaints and escalation metrics.
7. They will appoint a nodal officer responsible for regulatory and customer grievance management functions.
8. They shall have a dispute resolution mechanism binding on all the participants which shall include the transaction life cycle, detailed explanation of the types of disputes, procedure to deal with them, compliance, responsibilities of all the parties, documents, cause code, addressing process. complaint, turn-around-time for each stage, etc.