The RBI has granted in-principle approval to Pine Labs-owned Setu to operate as an account aggregator

• ByStartupStory     |    July 7, 2022

The Reserve Bank of India (RBI) has granted in-principle approval for the subsidiary of fintech infrastructure expert Setu, Agya Technologies, to function as an account aggregator (AA). The company will be able to introduce its own AA platform thanks to the permission, which was received on July 4. The business has previously developed the user interface for Onemoney, a licenced AA and one of the first to offer an app.

Co-founder and Chief Evangelist of Setu, Nikhil Kumar, said, “Aadhaar, eKYC, and eSign powered fintech version 1.0; the Unified Payments Interface powered version 2.0. (UPI). The Account Aggregator ecosystem for open banking will power fintech 3.0. “

“We have developed a top-notch API infrastructure platform that will enable every financial institution to join and develop with the AA ecosystem.” he continued. 

In addition to its expansion plans for the Open Network for Digital Commerce (ONDC) space and Open Credit Enablement Network (OCEN) framework, the AA licence was one of Setu’s primary offerings during its sale to merchant payments and lending platform Pine Labs. AAs make it possible for entities that use financial information to exchange it freely and instantly with financial information providers (FIPs), such as pension funds, banks, and AMCs.

The information exchange is carried out legally, securely, and with the consumers’ consent. The AA is data blind because it only gets encrypted data. The AA framework is designed to make it simpler, quicker, and more affordable for Indian customers to access financial services including loans and insurance. Pine Labs, which purchased Setu on June 23 for $70-75 million, will gain from the transfer as well. An internal AA platform will make it simpler for the company to onboard consumers and grant credit, and it will also help it expand its lending and online payment capabilities.

There are 51 financial institutions operating as FIPs and FIUs at the moment, including banks, NBFCs, investment consultants, stock brokers, and insurers. The State Bank of India (SBI), which accounts for the majority of savings accounts in the nation and will facilitate data sharing, is keenly anticipated by the ecosystem. According to data from Sahamati, the not-for-profit self-organized collective for the AA ecosystem, as of last week, a total of 8.19 lakh customer accounts had been linked to the AA ecosystem and 7.61 lakh consent requests had been granted.

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