RBI Tightens Oversight of Online Payments

The Reserve Bank of India (RBI) is stepping up scrutiny of the online payments sector with new guidelines for payment companies. These guidelines aim to ensure merchants comply with regulations and improve oversight of transactions.

• The RBI has set different levels of background checks (due diligence) for merchants based on their size. This ensures stricter checks for larger merchants handling significant transactions.
• Payment companies must now monitor the activities of merchants on their platforms. This will help identify any suspicious transactions or non-compliance with regulations.
• Starting August 1, 2025, only card issuers and networks can store data related to card transactions. This new rule aims to further strengthen data security in the online payments industry.

These measures come as the RBI seeks to ensure the safe and secure growth of India’s booming online payments sector.

Also Read– RBI Allows UPI Access for Prepaid Payment Instruments (PPIs)