New Delhi, June 5 -- The next contest in merchant payments is shifting toward startups, MSMEs, exporters, and importers, with payment aggregators such as Cashfree and MobiKwik moving more aggressively into that segment. Executives said the opportunity lies in companies with annual revenue of up to Rs.50 crore and Rs.100 crore, where smaller tickets are offset by higher frequency and deeper under-penetration.

The opportunity for payment aggregators in India is not in taking a percentage cut of every transaction. It lies in monetising merchant relationships through settlement tools, subscriptions, POS or device rentals, reconciliation, lending, Software-as-a-Service (SaaS) and, for cross-border merchants, FX and collection fees. RBI's 2020...