Reserve Bank wants stricter rules for e-commerce payments gateways

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News:RBI has asked for stricter rules for E-commerce marketplaces acting as payment gateways and payment aggregators to other merchants.

Facts:

What are payment gateways?

  • Payment gateways and payment aggregators refer to entities which provide technology infrastructure to route and facilitate the processing of an online payment transaction and perform other functions without actually handling the funds.
  • They also facilitate e-commerce sites and merchants to accept payment instruments from customers for completion of their payment obligations to the merchants. 

Draft rules for payment gateways:

  • The draft said the payment aggregators should have a minimum net worth of 100 crore and if they don’t manage to arrange that money within one year,they should stop doing their business.
  • The entities should have a nodal officer responsible for regulatory and customer grievance handling functions whose details are prominently displayed on their websites.
  • Further,the authorised payment gateways and payment aggregators should also,if required,maintain the funds received from customers in an escrow account with a bank.