The Reserve Bank of India (RBI) has granted Paytm an extension to resubmit its application for a payment aggregator (PA) licence. This was stated by the company in an exchange filing on Sunday (March 26).
On November 26, Inc42 reported that the RBI had rejected Paytm’s application, requesting information on its wholly-owned subsidiary Paytm Payments Services Limited (PPSL).
In the filing, the fintech behemoth stated that it had recently requested a 120-day extension to resubmit its application for the licence. For the time being, the RBI has approved its request because it has yet to receive a response from the government regarding One97 Communication Limited’s (OCL) investments in PPSL.
Paytm is backed by China’s Alibaba-backed Ant Group, which retains a 25% stake in the fintech behemoth. The government is investigating whether Paytm’s investments in PPSL were in accordance with FDI regulations.
According to Paytm, the RBI letter stated that once the federal bank receives government approval, it will give the fintech giant 15 days to reapply for the payment aggregator licence.
According to Paytm, this has no material impact on its business because the RBI communication only prohibited it from onboarding new users. “We can continue to offer payment services to our existing online merchants,” the Paytm added.
