With PA approval, fintech firm Decentro launches new payment stack

Fintech firm Decentro announced the launch of a new payment stack, Flow 2.0, months after the company received the final nod from the Reserve Bank of India (RBI) to operate as an online payment aggregator.

The company has launched fintech products such as collections on Unified Payments Interface (UPI) and will introduce recurring payments in the next few weeks.

“The key use cases for UPI collections will be e-commerce, logistics, last-minute delivery, hyperlocal commerce, gaming, edtech, among others. We will have recurring payments come out by early to mid-June. This would include E-National Automated Clearing House (E-NACH), setting up the mandates with use cases of subscriptions, investments, credit,” said Rohit Taneja, co-founder and chief executive officer (CEO), Decentro, in an interaction with Business Standard.

The company's launch of its latest solutions comes after receiving final approval to operate as an online payment aggregator in February of this year.

The licence from the banking regulator will enable the company to have control over merchant settlements, among other transaction processes.

“In simple terms, till now, we were a payment gateway. A payment gateway is somebody who is only handling the technology, but not the flow of money. As a payment aggregator, we can control that money flow into our escrow account and settle it with the merchant directly,” Taneja added.

The Bengaluru-based fintech infrastructure platform targets large merchants and takes on board about 40 such entities every month.

“Our strategy is to have maybe a couple of hundred, or less than a hundred (merchants) on a monthly basis. The ones we take on board tend to be mid-sized or large merchants,” he said.

Meanwhile, merchants will see a faster onboarding process with it being completed in under two days. Taneja elucidated that with the payment aggregator licence, the company may look to reduce the time to less than one working day in the future.

“The whole onboarding flow is in our control. Unlike in the old payment gateway mode where it was dependent on the bank. That is the benefit,” he said.

Flow 2.0 will enable enterprises to conduct transactions under RBI-approved frameworks. At present, the company caters to customers such as Shiprocket, Kodo, Volopay, among others.

Decentro is one of the 22 companies that have received the online payment aggregator licence this year. Approval from the regulator implies that the company will now directly fall under the RBI’s purview for compliance.

The company raised $4.7 million in a Series A funding round from Rapyd Ventures, Leonis VC, and Uncorrelated Ventures in 2022.

It is backed by Indian angel investors, including names such as Cred’s Kunal Shah, Lalit Keshre, co-founder and CEO, Groww, Beerud Sheth, co-founder and CEO, Gupshup, among others.