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A Payment Gateway License is an RBI-issued certification that allows the applicant to establish and run a payment gateway.
Payment Gateway Meaning
A Payment Gateway, in simple terms, is a gate through which electronic transactions take place. It establishes a secure line between the customer and the seller. And then, it provides a confidential path through which the customer can enter their details and complete the transaction. Throughout this process, the payment gateway securely connects the customer's digital payment wallets or bank accounts to the seller's bank accounts, and only then it allow the transaction to take place. The gateway takes its appropriate payment gateway charges in India once the transaction is complete.
How does the Payment Gateway work?
The payment gateway process takes place in three stages:
Components of Payment Gateway System
There are two components of an Online Payment Gateway:
Merchant Agreement
Those with the Payment Gateway license RBI first get into an agreement with the merchant that uses the gateway.
Secure Electronic Transactions
It's a security system that verifies user information without peeking into it. In doing so, it authenticates the information without compromising the user's Credit card/ debit card/ net banking information.
What is a Payment Gateway License?
This license is a registration certificate given by the RBI to proposed Payment Gateway companies in India so that they can create and run a payment gateway. RBI promotes this license to:
What are the kinds of Payment Gateway providers in India that require this license?
Following are the payment gateway providers for whom it's mandatory to get the payment gateway license
Following are the eligibility criteria to get the payment gateway license:
Following are the documents required for Payment Gateway registration:
The software code of the payment gateway system and its testing report by a certified software testing agency.
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At Registrationwala, it's our motto to minimize the extra professional payment gateway license RBI cost and maximize the input required for online payment gateway registration. So, if you're looking to start a payment gateway for India without any worry, reach out to our experts. We make payment gateway registration in India easy.
How to start a Payment Gateway business in India?
How to get a Payment Gateway license in India? Well, in the effort to make it easy to get a payment gateway license, India has formulated the following steps for the payment gateway registration process:
Application filing
Apply for Payment Gateway license. File the payment gateway application via FORM A addressed to the Chief Manager of the Department of PSS.
Pay the registration fee
Along with the application, don't forget to pay the payment gateway registration cost.
Application assessment
Once you file the application for a Payment Gateway license, RBI will start its assessment. It will check the details you've mentioned in your applications.
Application Scrutiny
Once RBI finds that you've provided the correct application, they start scrutinizing the application based on the following points:
What services would the proposed payment system conduct?
Grant of Certification
Once the RBI authorizes your application, it will send you the payment gateway certification for conducting payment gateway business in FORM B. Once the application is filed, the RBI would take a maximum of 6 months to grant the payment gateway certificate unless there are some issues with the application form.
Security-related Recommendations
The RBI has issued some important Security-related recommendations for the licensed Payment Gateway Systems that they must adhere to. Some of these recommendations are discussed in this article in the following subheadings.
Information Security Governance
The Payment Gateway Licensed System (PGS) must conduct a comprehensive security risk assessment of its people, IT, business process environment, etc.
This assessment must be done to identify risk exposures with remedial measures and residual risks.
These security checks can be one of the following:
Internal security audit
An annual security audit by an independent security auditor
CERT-In empanelled auditor.
The PGS must submit the reports on risk assessment, security compliance posture, security audit reports, and security incidents presented to the Board.
Data Security Standards
The Payment Gateway Licensed System must implement the best data security standards and practices, such as:
The PGS must report security incidents or cardholder data breaches to the RBI within the stipulated timeframe.
The PGS must also submit monthly cyber security incident reports with root cause analysis and preventive actions undertaken to the RBI.
Merchant Onboarding
The Payment License System must undertake a comprehensive security assessment during the merchant onboarding process to ensure the merchants adhere to these minimal baseline security controls.
Cyber Security Audit and Reports
The Payment Gateway Licensed System must carry out and submit the following to the IT Committee:
Information Security
The Payment Gateway system must review the Board-approved information security policy annually. The security policy must consider aspects the following aspects:
Alignment with business objectives
The Payment License System must frame an IT policy for regular management of IT functions and ensure detailed documentation of procedures and guidelines is implemented. In addition, the strategic plan and policy must be reviewed annually.
The board-level IT Governance framework must have the following:
Involvement of Board:
The major role of the Board or the Top Management of the Payment License system must involve the following:
IT Steering Committee:
The Payment License system must create an IT Steering Committee with representations from various business functions as appropriate.
The Committee then must assist the Executive Management in implementing the IT strategy approved by the Board. Lastly, It must have well-defined objectives and actions.
Enterprise Information Model:
The Payment License system must establish and maintain an enterprise information model to enable application development as well as decision-supporting activities consistent with the Board-approved IT strategy.
The model shall facilitate optimal creation, use, and sharing of information by a business in a way that maintains integrity and is flexible, functional, timely, secure, and resilient to failure.
Cyber Crisis Management Plan:
The Payment License system must also prepare a comprehensive Cyber Crisis Management Plan approved by the IT strategy committee.
It must include components such as Detection, Containment, Response, and Recovery.
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So, do you want to start a payment gateway in India? Get legally ready by obtaining a Payment Gateway license with our help.
Q1. What is a Payment Gateway License in India?
A. A Payment Gateway License is an RBI-issued certification that allows the applicant to establish and run a payment gateway.
Q2. What is a Payment Gateway in India?
A. A Payment Gateway, in simple terms, is a gate through which electronic transactions take place. It establishes a secure line between the customer and the seller.
Q3. How does a Payment Gateway work?
A. A Payment Gateway provides a confidential path through which the customer can enter their details and complete the transaction. Throughout this process, the payment gateway securely connects the customer's digital payment wallets or bank accounts to the seller's bank accounts, and only then it allow the transaction to take place.
Q4. Is there a payment gateway charge in India to be paid for using it?
A. The gateway takes its appropriate payment gateway charges in India once the transaction is complete.
Q5. Explain the working of a Payment Gateway system?
A. The payment gateway process takes place in three stages:
Q6. What are the components of a Payment Gateway System?
A. There are two components of an Online Payment Gateway:
Merchant Agreement: Those with the Payment Gateway license RBI first get into an agreement with the merchant that uses the gateway.
Secure Electronic Transactions: It's a security system that verifies user information without peeking into it.
Q7. What are the objectives of a Payment Gateway system?
A. A Payment Gateway license is the registration certificate given by the Reserve Bank of India to companies that want to create and run a payment gateway. RBI promotes this license to:
Q8. What are the kinds of Payment Gateway providers that require this license?
A. The following are the payment gateway providers for whom it's mandatory to get the payment gateway license:
Q9. What makes one eligible for getting a Payment Gateway License in India?
A. Following are the eligibility criteria to get the payment gateway license:
Q10. What must attachments with the license application for Payment Gateway be submitted to the RBI?
A. The following are the documents required for Payment Gateway registration:
Q11. How to become a Payment Gateway service provider in India?
A. How to start a Payment Gateway business in India? In the effort to make it easy to get a payment gateway license, India has formulated the following steps for the payment gateway registration process:
Q12. How can Registrationwala help you in getting the Payment Gateway License in India?
A. We provide end-to-end assistance for services related to Payment Gateway License:
Q13. What are payment gateway charges?
A. Payment Gateway charge or Payment Gateway price is the additional charge levied on the purchaser for using the gateway while he is transferring money to the online merchant for making a purchase.
