Paytm: Financial technology company One97 Communication, which owns the Paytm brand, has received government approval for 'downstream' investment in its wholly-owned subsidiary Paytm Payments Services Limited ( PPSL ). The company said in a notice to the stock exchange on Wednesday that it will apply afresh for the payment aggregator (PA) license.

Paytm said that PPSL has received approval from the Department of Financial Services, Ministry of Finance, Government of India for investment from the parent company through a letter dated August 27, 2024. With this, PPSL will re-apply for the payment aggregator license. In the meantime, PPSL will continue to provide online payment aggregator services to existing partners.

The Reserve Bank of India ( RBI ) had rejected Paytm's payment aggregator license permit application in November, 2022 and directed the company to re-apply with Press Note-3 compliance under Foreign Direct Investment (FD) norms. According to Press Note-3, the government had made its prior approval mandatory for investments from countries sharing land borders with India.

At the time of the rejection of the application, China's Alibaba Group was the largest shareholder in the company. RBI's payment aggregator guidelines also state that a single entity cannot continue to provide payment aggregator services as well as an e-commerce marketplace and such payment aggregator services should be separated from the e-commerce marketplace business.