Paytm Payment Services Limited (PPSL) has received an extension of time from Reserve Bank to resubmit its application to secure an online payment aggregator licence.

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In an exchange notification on Sunday, the company said, “We have recently received an extension of time from RBI for resubmission of the application. The letter from RBI says that PPSL can continue with the Online Payment Aggregation business, while it awaits approval from Government of India (‘GoI’) for past investment from OCL (One 97 Communications) into PPSL as per FDI Guidelines.”

PPSL is a 100 percent subsidiary of One 97 Communications.

In November last year, the Reserve Bank of India (RBI) had returned PPSL’s application seeking a payment aggregator (PA) licence, asking it to reapply within 120 calendar days after meeting certain conditions. The conditions included PPSL seeking necessary approval from the Government of India for past downward investment from One 97 Communications into PPSL, to comply with FDI guidelines.

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Paytm has now been granted 15 days’ time to re-apply for the licence from the date of receiveing the necessary government nod.

“As per RBI’s letter, on receipt of approval from GoI, PPSL will have fifteen days to submit the application seeking authorisation for PPSL to operate as an online PA. However, if any adverse decision is taken by the GoI, then the same shall be informed to RBI immediately. During this process, PPSL can continue with its online payment aggregation business for existing partners, without onboarding any new merchants,” Paytm said.

The company said it does not expect any material impact on business from the event, and was hopeful of receiving the necessary approvals in a timely manner.

“This continues to have no material impact on our business and revenues, since the communication from RBI is applicable only to onboarding of new online merchants and we can continue to provide payment services to our existing online merchants. Furthermore, for offline business, OCL can continue to onboard new merchants and offer them payment services including All-in-One QR, Soundbox, Card Machines, etc. There are no observations in the letter other than what is mentioned above. We are hopeful of receiving the necessary approvals in a timely manner,” it said in the exchange notification.

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The RBI introduced Guidelines for Regulating PAs and Payment Gateway in March 2020. A Payments Aggregator license, allows companies to provide payment services for merchants (online businesses or e-commerce firms) by accepting payment instruments from customers.

Last month, Reserve Bank of India published an update on PA licences given out so far, and their current status. As of February, RBI had returned Payment Aggregator applications of Paytm, Freecharge, PayU, and Tapits Technologies, and given in-Principle Authorisation to 32 existing PAs including Amazon and Google.

RBI has advised all stakeholders to transact with only those PAs who have been granted in-principle authorisation or whose application is currently under process. It said that stakeholders may transact with new PAs only after these entities have received ‘authorisation’ under Section 7 of the PSS Act from the central bank.

Also read: Paytm launches next-generation payments platform backed by home grown technology