Payment Aggregator Cross Border (PA-CB)

Recently, the Reserve Bank of India (RBI) announced that it would directly regulate entities facilitating cross border payment transactions.

Payment Aggregators – Entities that enable e-commerce sites and merchants to accept various instruments from customers to complete their payment obligations without the need for the merchants to create their own systems.
Payment Aggregator-Cross Border (PA-CB) – Entities that facilitate cross-border online payments for import and export of permissible goods and services.
Categories of PA-CB
- Export-only PA-CB
- Import-only PA-CB
- Export and import PA-CB

New RBI regulation

Authorised Dealer (AD) Category-I banks – They do not require separate approval for PA-CB activity.
Existing Non-banks providing PA-CB services – They must apply to the RBI for authorisation by April 30, 2024 and must register with the Financial Intelligence Unit-India (FIU-IND).
They shall have a minimum net worth of Rs. 15 crore at the time of applying and Rs. 25 crore by March 31, 2026.

Net worth is the value of the assets a corporation owns, minus the liabilities they owe.

New non-bank PA-CBs – They should have a minimum net worth of Rs 15 crore at the time of applying and Rs. 25 crore by the end of the 3^rd financial year of authorisation.
Other conditions – The maximum value per unit of goods / services sold/purchased shall be Rs. 25, 00,000.
If the per unit goods/ services imported exceeds Rs 2.5 lakh, then the PA-CB concerned must undertake due diligence of the buyer.
Customer due diligence should be undertaken by the merchant.
Proceeds from the Export Collection Account (ECA) shall be settled only in the account of such merchants.

Source:

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