Zomato Payments Private Limited (ZPPL), a wholly-owned subsidiary of Zomato Limited, has announced its decision to voluntarily surrender the certificate of authorisation issued by the Reserve Bank of India (RBI) to operate as an online payment aggregator. The board of directors of ZPPL has also decided to withdraw the application to operate as an issuer of pre-paid payment instruments.
Zomato Limited, a leading player in the food delivery and restaurant aggregation market, had initially sought to expand its operations into the digital payments sector. The company had obtained a certificate of authorization from the RBI to operate as an online payment aggregator and submitted an application on November 11, 2021, to become an issuer of pre-paid payment instruments.
However, the digital payments landscape in India has undergone significant changes since ZPPL first applied for these licenses. The payments infrastructure has become more robust, leading to a highly competitive environment dominated by well-established players.
In a statement to the exchange, ZPPL explained the rationale behind their decision. “At Zomato, we do not see ourselves having a significant competitive advantage against the incumbents in the payments space and hence we don’t foresee a business in payments space as commercially viable for us, at this stage,” the company said.
“While we were conscious of these developments as they unfolded, the real impact was more apparent as we got closer to putting in place the structure to commence the operations,” it further added.
ZPPL has assured stakeholders that this decision will not have any material impact on the revenue or operations of the company.