The Reserve Bank of India (RBI) has instructed card payment majors like Mastercard and Visa to suspend card-based commercial payments made by companies and small entities, according to an Economic Times report.
The report, citing industry sources, said transactions being done at other business outlets who might not be authorised to accept card payments have been temporarily halted.
The flow of money towards non-KYC-ed merchants, who are not authorised to accept card payments as merchants, might have led the regulator to take the step. However, the exact reason is not known, according to the report.
“An instruction has come to the fintechs which operate in this sector to pause business payments made by commercial cards until further notice,” the report quoted a founder of a fintech startup, who has received the notice.