Tata group-owned digital payments app,
Tata Pay
joins Google Pay, Razorpay and Cashfree among others to secure a much-anticipated payments licence from the
Reserve Bank of India
(
RBI
). The apex bank of the country has granted a
payment aggregator
(PA) licence to Tata Pay to operate in India. This will help the firm to use its platform to facilitate e-commerce transactions.
Tata Pay comes under the
Tata Digital
business unit of the conglomerate. It is the
Tata Group
's subsidiary entity which houses its digital businesses.
What it means for Tata Pay
In a statement to The Economic Times, the founder of a digital payment startup (who decided to remain anonymous) said: “With the payment aggregator licence, Tata can power all e-commerce transactions within its subsidiary entities which will help it manage funds better.”
In 2022, Tata Group partnered with ICICI Bank to launch its digital payments app on the
Unified Payments Interface
. The company has been planning a detailed financial services strategy, however, consumer traction on the platform is limited as of now.
Tata Group's other payments business
This is the second payments business that is owned by the Tata group. The company also owns the licence to run 'white label ATMs' in rural India. This business is run by the subsidiary
Tata Communications
through the brand name Indicash.
As per RBI data, Tata also set up a prepaid payments business (mobile wallets) in the past. However, in 2018, the company surrendered that licence. Last month, RBI granted the first set of
PA licence
s and opened up new merchant onboarding for Razorpay and Cashfree after nearly a year.
Identity verification startup DigiO also gets PA licence
Apart from Tata Pay, Bengaluru-based identity verification startup DigiO, which is backed by investment platform Groww, has also secured the PA licence as of January 1. DigiO powers digital identification for multiple fintechs. With this licence, the platform will also be able to bundle in-payment services.
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