On behalf payments

Hi Krishna Kumar! yes, a company can make payments on behalf of another company. This is called a payment processing arrangement. In a payment processing arrangement, one company (the "processor") agrees to process payments on behalf of another company (the "client"). The processor will typically charge a fee for its services. Payment processing arrangements are a common way for companies to manage their payments. They can save companies time and money and help improve compliance with payment processing regulations.

the legal impact of the arrangement would be that the payment processor may be considered a "financial institution" for certain purposes. This means that the processor may be subject to certain regulations designed to protect consumers and prevent financial crime. For example, the processor may be required to comply with anti-money laundering laws and implement certain security measures to protect customer data.

It is nothing but an ourtsourcing arrangement.

If the original company has engaged an outsourcing agent for this purpose then there is no legal infirmity in it.

There should be an agreement with other company to that extent.