RBI has power to regulate Payment Aggregators vis a vis Payment and Settlement Systems Act, 2007: HC

Lotus Pay Solutions Pvt Ltd Vs Union of India (Delhi High Court)

Conclusion:  

In present facts of the case, the Hon’ble High Court observed that “Payment Aggregators” would fall under Payment and Settlement Systems Act, 2007 as Payment Aggregator ensures that the money is transferred to the designated nodal account, and after a gap of a stipulated timeframe, which the petitioners say is three days, a settlement takes place and funds are transmitted to the merchant’s account. The Payment Aggregators, thus, not only provide, an integration system but also handle the funds of the customer. The definition of a Payment Aggregator would include this work function.

Facts:

In present facts of the case, the writ petition was filed, wherein three clauses of the circular dated 17.03.2020 issued by RBI, titled “Guidelines on Regulation of Payment Aggregators and Payment Gateways” were challenged.

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