Here’s All You Should Know About a Nodal Account

All About a Nodal Account

Running an online aggregator model? Confused if you should open a nodal account? We’ll help you understand the needs & relevance of a Nodal account in your business. Why is a nodal account relevant? With the new age of digital platforms and aggregators revolutionising the market, the RBI has proposed nodal accounts for online intermediaries.

The purpose of a nodal account is to hold funds on behalf of the customers and vendors. It safeguards the interests of customers and vendors so that payments are collected, processed and payouts, are done to relevant vendors without undue delay. Your business would be an intermediary if you meet any one of the following criteria:

  • You are collecting money on behalf of vendors from your customers.

Below are some of the real-world use cases and how nodal accounts are advantageous for them:

E-commerce & marketplaces

  • Easily set up sellers/vendors and set up commissions and settlements

Lending & Financing

  • Easily Disburse loans to customers


  • Instant disbursals of claim amounts

What is a nodal account?

Nodal Account is a type of current account that is used to hold the funds on behalf of customers & vendors (payouts) to safeguard the interests of the two parties. A nodal account ensures that the money does not legally belong to the intermediary at any point of time. Nodal Accounts were introduced by the RBI as a mandate for intermediaries such as aggregators, e-commerce platforms & payment gateways. The guidelines posted by the RBI regarding the same as posted below:

How does a nodal account work?

During the operation and onboarding, the problems most people face while working with most banks:
  • Complicated on-boarding and minimum business requirements

Through Paytm Payments Bank’s nodal account offering with powerful APIs, easier on-boarding and dedicated Key account manager, the entire process becomes easy. We provide a powerful, easy & robust system to help you focus on your business.
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