Along with Tata Pay, Bengaluru-based identity verification startup DigiO, backed by Groww, has also secured the payment aggregator licence as of January 1.
The Reserve Bank of India (RBI) has granted a payment aggregator (PA) licence to Tata Payments, Tata group’s digital payments app. This will help the firm facilitate ecommerce transactions through its platform. Tata Payments is held through Tata Digital, the group's subsidiary entity, which houses its digital businesses.
“With the payment aggregator licence, Tata can power all ecommerce transactions within its subsidiary entities which will help it manage funds better,” said a founder of a digital payment startup on the condition of anonymity.
Along with Tata Pay, Bengaluru-based identity verification startup DigiO, backed by investment platform Groww, has also secured the PA licence as of January 1. DigiO powers digital identification for multiple fintechs and will be able to bundle in-payment services on top of it.
In 2022, Tata Group launched its digital payments application on the Unified Payments Interface in partnership with ICICI Bank. While the salt-to-technology conglomerate has been planning a detailed financial services strategy, consumer traction is limited as of now.
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This is the second payments business to be housed within the Tata group. It also owns the licence to run 'white label ATMs' in rural India under the subsidiary Tata Communications through the brand name Indicash.
RBI data showed that Tata had set up a prepaid payments business (mobile wallets) in the past, but surrendered the licence in 2018. ET wrote on December 20 that the RBI granted the first lot of PA licences and opened up new merchant onboarding for Razorpay and Cashfree after almost a year.
