The RBI has approved Groww’s bill payments platform, Groww Pay Services, to function as a payment aggregator. The business acquired an in-principle approval from the central bank for its PA licence in January of this year. Groww Pay now joins Amazon Pay, JusPay, Stripe, Tata Payments, and Mswipe among companies that have secured PA licences this year.

Groww Bags Receives RBI Approval

The Reserve Bank of India (RBI) has approved fintech unicorn Groww’s bill payments platform Groww Pay Services to operate as a payment aggregator (PA), adding another name to the roster of online payment providers.

The startup gained in-principle approval from the central bank for its PA business in January of this year.

A corporate insider told Inc42 that the PA license is a significant development that aligns with Groww’s ambitions to become a full-fledged financial institution with diversified offers.

“With the final authorisation from the RBI, we will look into what sort of gaps we can fill in the existing market with our solutions,” a source said.

The PA license allows the firm to recruit retailers and provide digital payment acceptance solutions. The central bank initially introduced the PA framework in March 2020.

Groww was founded in 2017 by Harsh Jain, Lalit Keshre, Neeraj Singh, and Ishan Bansal as an investment technology platform that allowed users to participate in equities, exchange-traded funds (ETFs), and initial public offerings (IPOs). However, the firm is constantly extending its offerings.

Groww stated last year that it had completed the acquisition of Indiabulls Housing Finance’s mutual fund business for INR 175.6 crore, marking its entry into the mutual fund industry.

The Securities and Exchange Board of India (SEBI) approved the startup’s proposal to launch India’s first Nifty non-cyclical consumer index fund last week. The platform’s asset management firm (AMC), Groww Mutual Fund, is anticipated to launch its new fund offering (NFO) in the first week of May.

In July 2023, Groww added a Unified Payments Interface (UPI) payments feature to its app.

The feature was implemented shortly after the National Payments Corporation of India (NPCI) granted Groww Pay a third-party application provider (TPAP) licence. With Yes Bank as its payment service provider (PSP), the payments app has focused on bill payments such as energy, water, loan, and credit card repayments.

It also expanded its lending services after obtaining an NBFC license through Groww Creditserv Technologies in late 2022.

In the midst of all this, Billionbrains Garage Private Limited, Groww’s parent company, became profitable in the fiscal year 2022-23. It made a net profit of INR 448.7 crore in FY23, compared to a net loss of INR 239 crore in the previous fiscal year. Operating revenue increased more than threefold to INR 1,277.8 crore from INR 351 crore in the previous fiscal year.

On the other side, the RBI has been on a roll this year, adding new PA license holders to its registry. Innoviti, a developer of digital payment solutions, and Concerto Software and Systems also received PA licenses last month.

They joined Amazon Pay, JusPay, Stripe, Tata Payments, and Mswipe as companies who received PA licences this year.

Meanwhile, Kunal Shah-led Cred, PayU, and Khatabook, among others, have received preliminary approval from the central bank to function as payment aggregators.