IRCTC, the Railway catering and tourism company, has initiated the process of applying for a Payment Aggregator licence with the Reserve Bank of India (RBI).

According to the company’s Chairman and Managing Director, Seema Kumar, it is putting the in-house payment gateway business, I-PAY, under a separate subsidiary as part of the process requirement to obtain the licence.

A Payment Aggregator licence, allows companies to provide payment services for merchants (online businesses or e-commerce firms) by accepting payment instruments from customers for the completion of their payment obligations. This is enabled without the need for merchants to create a separate payment integration system of their own. In the process, they receive payments from customers, pool them, and transfer them on to the merchants after a certain time period.

“We are in the process of getting the licence (payment aggregator) from the RBI. And we are also in the process of forming the subsidiary for this,” Kumar said during an earnings call.

The IRCTC application was returned by RBI on February 26, 2021.

The Railway PSU recently received approval from the Registrar of Companies, NCT, Delhi, and Haryana to alter the Main Objects Clause of the Memorandum of Association and insert a new clause to act as a Payment Aggregator. Shareholders passed the special resolution at the annual general meeting on August 26 last year.


Incidentally, IRCTC already has an in-house payment gateway called I-PAY, which enables payments for booking tickets for rail, bus, and air travel and tour packages on the IRCTC website and mobile app. The gateway was launched on a pilot basis in 2018–19.

The gateway clocked 1.54 crore transactions in Q1FY23, a 36 per cent increase YoY, Kumar said.

“Further being a product of IRCTC, a public sector, it (I-PAY) shall have an added advantage over private players in lieu of trust and reliability. In this regard, IRCTC has plans to operate as a payment aggregator. For this, IRCTC will be seeking authorisation (from the Reserve Bank of India) under the Payment and Settlement Systems Act, 2007,” the company said in the Annual Report for 2022–23.

As per the previous year’s AGM notice, as a payment aggregator, IRCTC would carry on electronic and virtual payment system services, payment gateway and aggregator services, prepaid and postpaid payment instruments, and payment systems — including open, closed, and semi-closed systems of payment instruments — both in the country and abroad.

It would also operate as a bill payment gateway to provide services for the payment of utility bills, fees, and municipal taxes under the Bharat Bill Payment System (BBPS).