One MobiKwik Systems Limited (NSE:MOBIKWIK) informed exchanges that it has received an in-principle approval for its Payment Aggregator - Physical (PA-P) license from the Reserve Bank of India under Regulation 30 of SEBI (LODR) Regulations, 2015. The approval enables the company to expand its offline merchant payments business in India through regulated payment acceptance infrastructure.

The company stated that this milestone supports its transition toward broader payment acceptance services across offline commerce channels. It also noted that it already operates Payment Aggregator - Online services through its subsidiary Zaakpay, creating an omnichannel structure across online and offline payments.

Merchant Business Strategy
MobiKwik currently supports a merchant base of 4.9 million through payment tools including UPI QR, Soundbox devices, and EDC machines. The company has identified small businesses, oil & gas outlets, and organised retail as its primary focus segments over the next 18-24 months.

The business plan includes scaling Soundbox and EDC device deployments to expand acceptance infrastructure across merchant locations. The company expects offline merchant payments to contribute to long-term transaction engagement and monetisation opportunities linked to merchant services and data-driven credit distribution.

Source: Analysis by Kalkine 

Management Commentary
Commenting on the development, Bipin Preet Singh, Co-founder, MD & CEO, said:
“Offline merchant payments are emerging as one of the strongest growth drivers within India’s digital economy, particularly across under-penetrated markets beyond urban India. This PA-P approval strengthens our ability to scale merchant payments infrastructure across the country and sets us up for 10x growth in merchant business by FY28. We are grateful to the RBI for the approval and reposing its faith in us. We remain focused on building secure, scalable and technology-led solutions that help merchants participate more effectively in India’s growing digital economy.”

The statement highlights the regulatory milestone and outlines the company’s focus on expanding payment acceptance infrastructure across offline merchant ecosystems.

Financial and Market Context
The company estimates that offline merchant payments represent a large addressable market, with industry projections placing merchant payments gross merchandise value opportunity at USD 1.8-2 trillion by FY28, based on external estimates. Offline acquiring is characterised by merchant discount rate structures, subscription-based device usage, and rental-based revenue models, differing from zero-MDR consumer payment rails.

The company also noted that offline payment acceptance typically involves lower competitive intensity compared to consumer digital payment segments, while offering structured monetisation pathways linked to merchant services.

Platform Expansion and Ecosystem
MobiKwik operates as a digital payments and financial services platform serving over 189 million registered users. Its merchant ecosystem is supported through multiple payment products, including wallet services, UPI-based offerings, and payment gateway solutions.

The company has expanded into financial distribution products such as credit offerings, savings instruments, mutual funds, fixed deposits, and digital gold distribution through its platform infrastructure. These services operate alongside its core payments business.

Industry Environment
The RBI’s regulatory framework for payment aggregators continues to define operational standards for digital payment providers in India. Offline payment acceptance remains a developing segment within the broader fintech ecosystem, with infrastructure deployment and merchant onboarding forming key operational areas.

The approval for PA-P licensing places MobiKwik within the regulated framework for physical merchant acquiring services, allowing structured participation in offline payment acceptance under banking partnerships.

Key Risks

• Regulatory changes in payment aggregator licensing framework may affect operational structure.
• Merchant acquisition costs may increase due to competitive offline payment ecosystem conditions.
• Device deployment cycles for Soundbox and EDC infrastructure may face execution delays.
• Revenue visibility may fluctuate based on transaction volumes and merchant adoption patterns.

Summary
MobiKwik (NSE:MOBIKWIK) has received RBI in-principle approval for a Payment Aggregator - Physical license, enabling expansion in offline merchant payments. The company plans to scale merchant operations across small businesses, retail, and oil & gas outlets.

It currently serves 4.9 million merchants through multiple payment tools. The approval supports regulated participation in offline payment infrastructure and ecosystem development across India.

FAQs

Q1: What does RBI PA-P approval mean for MobiKwik operations?
A: It allows MobiKwik to operate offline payment aggregation services under regulated RBI licensing framework in India.

Q2: Which merchant segments is MobiKwik targeting post approval?
A: Small businesses, oil & gas outlets, and organised retail sectors across offline payment acceptance channels.

Q3: How many merchants currently use MobiKwik platform services?
A: The company reports approximately 4.9 million merchants using its payment and acceptance solutions.