RBI Directs Visa and Mastercard to Stop Third-Party Fintech Business Payments

GG News Bureau
Bengaluru, 15th Feb. The Reserve Bank of India (RBI) has instructed Visa and Mastercard to stop card-based business-to-business payments facilitated by third-party fintech firms, sources familiar with the matter revealed.

While the central bank hasn’t specified the reason behind these restrictions, it’s clarified that they only apply to commercial payments routed through third parties, excluding all corporate card payments.

These restrictions primarily affect a category of fintech firms known as “business payment solution providers” (BPSPs), which assist in making payments to merchants not accepting card payments directly. However, regular payments made to businesses via corporate cards remain unaffected.

A spokesperson from Visa India confirmed receiving communication from the RBI on February 8, requesting information on BPSPs’ role in commercial payments and directing to suspend all related transactions.

On the other hand, Mastercard did not respond to requests for comments. The RBI, which regulates India’s payment systems, has not provided a public statement on the matter.

Earlier reports suggested that the RBI directed leading card networks, including Visa and Mastercard, to halt such card payments, indicating ongoing discussions between Visa and the RBI to ensure compliance.