Google India Digital Services Pvt Ltd on Wednesday has filed its response with Delhi High Court stating that Google Pay doesn’t require any authorization from Reserve Bank of India (RBI) to facilitate the financial transactions as it is a third party application provider (TPAP) and not a Payment Service Operator (PSO).
Google in its affidavit stated, “the PSO authorised by the Reserve Bank of India (RBI) is the National Payment Corporation of India (NPCI) which is the owner and operator of the entire unified payment interface (UPI) network. NPCI, in turn, authorises the payment service provider banks and third-party application providers (TPAPs) like Google Pay to conduct transactions on its network.”
Following the request of the petitioner seeking more time to reply to the affidavit, Delhi High Court bench of Chief Justice D.N. Patel and Justice Prateek Jalan has listed the matter on August 31.
A financial economist and petitioner Abhijit Mishra has filed a PIL in Delhi High Court alleging GPay of facilitating online financial transactions without the authorization of central bank, RBI and is violating the Payments and Settlements Act.
The petitioner has also argued that GPay is not there in the NPCI’s list of authorised “payment systems operators” released on March 20, 2019.
Google in its reply filed through Himanshu Vij stated that GPay works within the NPCI regime and complies with its guidelines and the applicable laws. “It will take steps to comply with the RBI’s March 17, 2020 ‘Guidelines on Regulation of Payment Aggregators and Payment Gateways’ which mandates that entities providing merchant services, like Google Pay, get registered with the central bank,” stated the affidavit.
The affidavit further stated that it is also complying with the RBI’s data circular issued in 2018 which makes it mandatory for all the system providers to store the entire data related to payment systems in India only.
Google also pointed out that, even though they are not obliged to comply with that order as it is a service provider not a system provider, they are following in accordance with them.
RBI has also clarified earlier that Google Pay doesn’t operate any payment systems and is a third party application provider instead. Therefore, there is no violation of Payment and Settlement Act, 2007.
Google Pay is the topmost payment app in India with 67 million monthly active users.