In a significant development for the Indian fintech landscape, Zomato Payments Private Limited, a subsidiary of the renowned food delivery platform Zomato, has secured the much-coveted payment aggregator (PA) license from the Reserve Bank of India (RBI). This pivotal approval, granted on January 24, 2024, positions Zomato to actively participate in facilitating ecommerce transactions through its platform.
Zomato had initiated the process towards becoming a payment aggregator with the incorporation of Zomato Payments Private Limited (ZPPL), a wholly-owned subsidiary of Zomato Private. The disclosure, made in August 2021, outlined ZPPL’s intended business activities, including serving as a payment aggregator and an issuer of pre-paid instruments. Now, with the RBI’s authorization, ZPPL is officially empowered to operate as a payment aggregator in India, marking a strategic milestone for the foodtech giant.
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This development aligns Zomato with other major players in the fintech arena, such as Tata Pay, Razorpay, and Cashfree, who have already obtained the coveted payment license. Payment aggregators play a crucial role in enabling ecommerce platforms, mobile applications, and merchants to seamlessly accept various payment instruments from customers without the need for the merchants to create their own payment interfaces.
Zomato’s foray into the payments space had earlier manifested in the launch of Zomato Pay, its Unified Payments Interface (UPI) offering, in collaboration with ICICI Bank. The objective was to reduce reliance on third-party payment applications like Google Pay, PhonePe, and Paytm, thereby mitigating the associated merchant charges. Zomato Pay has since become an integral part of the Zomato ecosystem, offering customers convenient payment options for online food and grocery orders on Zomato and Blinkit.
Zomato Pay further extends its utility by providing users with the option to settle bills at select restaurants listed on the platform using various payment methods, including cards, net banking, and UPI. This multifaceted approach positions Zomato as not just a food delivery platform but also as a comprehensive ecosystem catering to diverse consumer needs.
Interestingly, Zomato had previously ventured into the financial services space by partnering with RBL Bank to offer co-branded credit cards. However, this collaboration was terminated in May of the preceding year, emphasizing the dynamic nature of partnerships in the ever-evolving fintech landscape.
With the RBI’s nod to operate as a payment aggregator, Zomato is poised to enhance its financial services offerings, providing users with a seamless and integrated experience within the Zomato ecosystem. As Zomato Pay becomes more entrenched in the digital payment space, the foodtech giant is well-positioned to redefine the landscape of online transactions in India.
About Zomato Pay
Zomato Pay is the payment service offered by Zomato, a popular food delivery and restaurant discovery platform in India. Zomato Pay allows users to make secure and convenient digital payments for their food orders and other services on the Zomato platform.
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