RBI’s stricter KYC rules may slow merchant onboarding 90%: experts
RBI) draft norms around stricter Know Your Customer (KYC) rules for payment aggregators could slow the onboarding of online merchants by as much as 90%, industry insiders said.
The new rules will be applicable to existing players across online payment platforms, such as Razorpay, Cashfree, and PayU, card payment companies, such as Pine Labs, Innoviti Payments, and MSwipe, and QR code deployers, such as PhonePe, BharatPe and Google Pay.
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“One physical KYC can cost as much as Rs 400-500 depending on many factors, even if we are talking about 10 lakh merchants for a specific service provider, we could be looking at around Rs 40 to 50 crore of instant cost impact,” said a top executive at a large payment firm, on the condition of anonymity.
CPV, or contact point verification, is a part of enhanced due diligence the regulator has suggested for payment players, which means physical visits will be required at merchant outlets for verification.
It could push up operational costs by three to four times for these digital payment companies, as per industry
