Shares of PB Fintech were climbing on Thursday after the firm took steps to enter the payment aggregator business.

What Happened: Fintech major Policybazaar’s parent company announced on Wednesday its plan to venture into the payment aggregation business by establishing a new wholly-owned subsidiary named PB Pay.

The company disclosed its intention to apply for a payment aggregator license from the Reserve Bank of India (RBI) once the new entity is incorporated.

In a regulatory filing, PB Fintech stated that PB Pay Private Limited will engage in the business of payment aggregation, facilitating merchants with offline and/or digital payment acceptance infrastructure. The proposed authorised share capital for the subsidiary is ₹50 crore, with a proposed paid-up share capital of ₹27 crore.

See Also: LIC Employee Fired For Exploiting Late Father’s Account In Front-Running Scheme

It’s noteworthy that the RBI introduced the payment aggregator framework in March 2020, mandating the license for acquiring merchants and providing digital payment acceptance solutions. Compliance with regulatory and statutory requirements, including the minimum net worth threshold, is essential for applicants seeking this license.

PB Fintech’s move coincides with increased scrutiny by the RBI on payment aggregators and heightened compliance standards for obtaining such licenses. In recent times, the RBI has granted licenses to several players, including Infibeam Avenues, Amazon Pay, MSwipe, Zoho and Juspay.

This strategic initiative follows PB Fintech’s successful financial performance in Q3 FY24, with a profit after tax (PAT) of ₹37.2 Cr compared to a loss of ₹87.6 Cr in Q3 FY23. Operating revenue surged by 43% year-on-year to ₹871 Cr in Q3 FY24.

Price Action: PB Fintech’s shares were up 2.62% at ₹1,143.35 near the start of trade on Thursday.

Read Next: Google And Apollo To Provide 3M Free AI Screenings For Life-Threatening Diseases