Amazon Pay get RBI's payment aggregator license; Here's what the company said

Amazon Pay, the digital payments arm of Amazon India, has been granted a payment aggregator (PA) license by the Reserve Bank of India (RBI), positioning it among the elite group of companies authorized to offer online merchant payment services. 

The approval, which was received on February 20, enables Amazon Pay to operate as a payment aggregator and facilitate e-commerce transactions seamlessly through its platform.

Enhancing merchant payment business

With this license, Amazon Pay aims to enhance its merchant payments business, a critical area given Amazon's vast online shopping presence in India.

The company said it aims to simplify lives and fulfil the aspirations of merchants and customers by providing secure, convenient, and rewarding digital payment experiences. This development is expected to strengthen Amazon Pay's distribution channels and allow it to deliver innovative solutions across India.

What does this license mean for Amazon Pay?

The Payment Aggregator license allows Amazon Pay to operate as an intermediary between merchants and payment processors or banks, consolidating payments on behalf of multiple merchants before distributing the funds accordingly.

The model is crucial for businesses operating online marketplaces or platforms with multiple sellers. The license ensures Amazon Pay meets the financial and security standards set by the RBI, further solidifying its position in the fintech sector.

“We are excited and thankful to receive the final authorisation from the Reserve Bank of India (RBI) to function as a Payment Aggregator. We remain committed to simplify lives and fulfill the aspirations of merchants and customers,” an Amazon spokesperson said.

Joining the ecosystem of licensed aggregators

With the approval of this license, Amazon Pay joins a growing list of companies that have received the PA license from the RBI since December 2023, including notable names like Zomato, Google Pay, Zoho, Razorpay, and Cashfree. 

Prior to receiving the PA license, Amazon Pay was already operating under a Prepaid Payment Instruments (PPI) license, with 6.6 crore wallets issued and over 40 lakh transactions processed in January 2024 alone.

Despite reporting a net loss in the previous fiscal year, the new license presents a major opportunity for Amazon to bolster its e-commerce payments business and extend its services to direct-to-consumer sellers looking to sell products online.

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