PhonePe Group exits Account Aggregator biz, will partner other AAs to boost financial inclusion

As one of India's largest fintechs, PhonePe Group said it has always tried to build products with a deep focus on solving for financial inclusion for all Indians, which is critical for the country to realise its ambition of becoming a developed economy by 2047.

"We strongly believe that growing the Account Aggregator (AA) ecosystem is very important to addressing financial inclusion properly. By 2022, the AA ecosystem was still very nascent and early adoption numbers were still low," the company said in a statement.

In June 2023, PhonePe Group received its own AA license in a bid to build "our own Account Aggregator platform and help accelerate the AA ecosystem's growth".

"This was a departure from our usual strategy of building only end consumer (B2C) products. We feel proud that we have managed to register nearly 5 crore Indians onto our AA platform in less than two years," the company informed.

However, due to competing priorities, "we have not been able to onboard as many financial information providers (FIPs) to our platform as we would have liked".

"The good news is that the AA ecosystem itself is flourishing today, and many of the other players are growing exponentially. Therefore, PhonePe Group has decided to exit the Account Aggregator business, and instead we will partner with other AAs in the market," it informed.

Accordingly, the company has decided to surrender its NBFC-AA licence to the Reserve Bank of India (RBI), and initiated the wind down of its AA operations.

"We will be reaching out to our AA user base shortly to inform them of our decision, and help them as per regulatory guidelines," said the PhonePe Group.