Payment aggregators seek RBI extension for merchant re-KYC deadline
Payment aggregators, including Paytm, PhonePe and Google Pay, have reportedly sought more time to complete merchant re-KYC ahead of the September 15 deadline, citing thousands of pending cases among small and informal businesses requiring in-person verification.
What happened
Payment aggregators including Paytm, PhonePe and Google Pay have sought more time from RBI to complete merchant re-KYC, citing backlogs among small informal
Key facts
- September 15 re-KYC deadline
- backlog running into thousands of merchants
- around 80% of re-KYC expected to be completed by the deadline
- three payment-aggregator segments: PA-Online, PA-Physical and PA-Cross Border
- RBI Master Directions issued in September 2025
Why this matters
Large pending re-KYC volumes expose a potential opportunity for identity-verification, field-operations and merchant-onboarding partners that can help aggregators process informal-business compliance at scale.
What to watch
- RBI circular, industry communication or supervisory guidance issued before September 15.
- Whether any extension applies universally, only to legacy merchants, or only to specific KYC deficiencies.
- Reported percentage of completed merchant re-KYC at major aggregators and size of pending merchant cohorts.
- Merchant-account freezes, QR deactivations, settlement holds or unusual payment-failure complaints after the deadline.
- Growth in field-verification hiring, agent incentives and merchant communications by Paytm, PhonePe, Google Pay and acquiring banks.
- Any clarification permitting digital, video-based or delegated verification methods for low-risk merchants.
- Payment aggregators will expand field-agent networks, outsourced verification capacity and merchant outreach through QR stickers, app alerts, call centers and local-language campaigns.
- Paytm, PhonePe and Google Pay are likely to prioritize high-volume merchants and urban clusters, leaving the smallest low-value or hard-to-locate merchants at greatest risk of temporary restrictions.
- Aggregators may seek RBI clarification on video KYC, simplified re-verification for existing merchants, shared-document workflows and risk-based exemptions.
- Merchant-acquiring banks and fintech partners may tighten onboarding and documentation checks, extending compliance friction to new merchant additions.
- Retailers dependent on UPI QR acceptance may add backup payment rails, including alternate QR providers, card terminals or cash-promoting contingencies.