Payments and banking platform for businesses , US payment startup , and merchant commerce company have received notices from the Reserve Bank of India (RBI) to withhold onboarding any new online merchants to their platforms, sources told YourStory.
The embargo will be in effect only until the three companies submit an audit report to the RBI showing they have complied with its rules and regulations for the payment aggregator/payment gateway (PA/PG) licences. Razorpay, Pine Labs, and Stripe were among the first ones to get the regulator’s nod to provide PA/PG services.
Razorpay confirmed that it has received the notice. Neither Stripe nor Pine Labs responded to YourStory’s request for comment.
The news on Razorpay being asked to hold off onboarding new merchants was first reported by Moneycontrol.
“The action is not a punitive one, otherwise the RBI would’ve mentioned it on the website,” one of the sources said.
Razorpay is likely to submit its audit report to the regulator as early as next week, and the embargo could be lifted in a couple of weeks, a source close to the matter said.
Pine Labs has also been making changes to its business to comply with the RBI’s rules. Its report could go out later next week, a source inside the company told YourStory on condition of anonymity.
Other companies in line for the PA/PG licence could also face similar restrictions in the coming weeks, but it’s not likely to have any material effect on the companies, since it would be just a matter of a few weeks.
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