Jio Payment Solutions, part of Jio Financial Services (JFS), has received regulatory approval from the Reserve Bank of India (RBI) to operate as an online payments aggregator, starting from October 28, 2024. This authorization allows Jio Payments to manage digital transactions between merchants and consumers, positioning it as a competitor in the payment services space, similar to other platforms like Paytm.
Strategic market position amid competitor challenges
With this approval, Jio Payments becomes part of a select group of RBI-certified online payment aggregators, marking a significant step forward in India’s digital payments industry. The timing is notable, as Paytm, a major digital payments provider, recently encountered regulatory restrictions that limited its ability to reach new users. These limitations create an opportunity for Jio Payments to potentially expand its influence and reach in the digital finance space, possibly capturing a larger market segment.
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The role of online payment aggregator allows Jio Payments to provide businesses and merchants with tools to accept multiple payment types, such as debit and credit cards, Payment Interface transactions unified account (UPI), e-wallet and others. Jio’s move into this space will complement its existing offerings through Jio Payments Bank, which offers digital savings accounts with biometric access, as well as physical debit cards. management, serving an existing user base of more than 1.5 million active customers.
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RBI approval strengthens Jio’s Fintech ambitions
The RBI’s decision underscores the bank’s confidence in Jio’s compliance with regulatory standards, paving the way for Jio to play a more prominent role in India’s rapidly growing fintech ecosystem. JFS has been clear that its ambitions include strengthening its digital banking and payments portfolio and this approval is in line with those objectives.
This development by Jio Payments comes as Paytm faces ongoing legal issues. Paytm Payments Bank, the financial arm of Paytm, was recently restricted from accepting new customers by the RBI due to compliance issues. This has limited Paytm’s scalability, opening the door for other providers, including Jio, to meet unmet needs in digital payments.
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Jio Financial Services, spun off from Reliance Industries, focuses on investments, financing, insurance brokerage, payments banking and general services. EQUAL reported According to CNBC TV 18, in August 2024, JFS increased its stake in Jio Payments Bank to 82.17%, strengthening its strategic investment in financial services. The move is aimed at strengthening JFS’s position as the company continues to grow its suite of services in India’s competitive fintech market, with the goal of further expansion and innovation.
