Paytm Offline Merchant Business Moves to PPSL: RBI PA Norms
Why in the news
One 97 Communications shifted offline merchant payments to its wholly owned arm, Paytm Payments Services Ltd (PPSL), to meet RBI’s September 2025 payment aggregator rules.
Key facts
- Legal basis: Payment and Settlement Systems Act, 2007, under which RBI governs aggregators.
- Rulebook: Master Directions dated 15 September 2025; goals: financial stability, customer protection, operational integrity.
| Area | Rule |
|---|---|
| Entity | All aggregation in one regulated entity, avoiding commingled funds |
| Escrow | Customer money in a separate escrow account with a scheduled commercial bank; not for operating costs |
| Settlement | T+1 to merchants (domestic); grievance redressal |
| IT security | Data localisation, cyber audits, PCI DSS |
| Reporting | Periodic reports to RBI; annual statutory audit |
| Governance | Board-approved policies; independent directors |
| Fund use | No lending, investing or deposit-like services |
| Authorisation | In-principle RBI approval first |
Implications for Paytm
- One regulated entity for merchant payments, better fund segregation, risk management and governance.
Exam angle
- PSS Act 2007; T+1 settlement; PPSL is the subsidiary.