Unified Payments Interface (UPI) from India: Expanding Global Use (2024)

India digital payment systems like the Unified Payments Interface (UPI) is steadily becoming globally attractive amid measures to enable seamless cross-border transactions. This is lowering cost of fund transfers and remittance payments. Overseas markets accepting UPI payments include Singapore, Malaysia, UAE, France, Nepal, UK, Mauritius, Sri Lanka, to name a few.

India is making significant strides in expanding the network of its digital payment systems like RuPay, UPI (Unified Payments Interface), etc. globally.

Countries that have embraced different forms of Indian payment systems include France, UAE, Saudi Arabia, Bahrain, Singapore, Maldives, Bhutan, and Oman. This implies that Indians will now be able to make payments through UPI, etc. in these countries.

Speaking on the sidelines of the G20 digital economy working group meeting in Lucknow, Union Minister Ashwini Vaishnaw said [February 13, 2023] that India had signed memoranda of understanding (MoUs) with 13 countries that want to adopt the UPI interface for digital payments, and that Singapore has completed its UPI integration.

These global partnerships have come through as the NIPL (NPCI International Payments Limited) is forging partnerships with different countries to build a huge acceptance network for RuPay and UPI, which will allow Indian travelers to make payments via these channels in their destination country of travel.NIPL was incorporated in April 2020 as a wholly owned subsidiary of the National Payments Corporation of India (NPCI), devoted for deployment of RuPay and UPI outside of India.

Also, and in keeping with its ambitions to expand the digital economy, India has announced UPI access for NRIs in 10 foreign countries whose Indian bank accounts are linked to foreign mobile numbers as well as foreign travelers coming to India – at select international airports to begin with.

Tracking global adoption of India’s UPI digital payment system: Partners reaching agreement

Acceptance of India’s UPI in overseas markets

Greece

NPCI International Payments Limited (NIPL), a subsidiary of NPCI, and Eurobank, a Greek bank, have signed an MoU aimed at enhancing cross-border payments using the UPI platform, with a specific focus on streamlining remittances from Greece to India.

Sri Lanka and Mauritius

UPI services have been launched in Sri Lanka and Mauritius per reporting on February 14, 2024, a week after becoming available in France at the Eiffel Tower. Individuals from Mauritius visiting India will also be able to use UPI for their payment needs.

UAE

In February 2024, the UAE and India signed an agreement on interlinking the national payment platforms – UPI (India) and AANI (UAE), which will facilitate seamless cross-border transactions between the two countries.

Previously, on July 15, 2023, India and the UAE had signed an agreement to interlink the payment and messaging systems of both countries. The MoU, signed by the respective Federal Bank governors of both countries, will enable the integration of India’s UPI with the UAE’s Instant Payment Platform (IPP), facilitating more efficient cross-border transactions. The UPI is India’s real-time payment system, while the IPP is the UAE’s equivalent system.

Further, back in 2022, NIPL had partnered with LuLu Financial Holding, Mashreq Bank, and Network International in the UAE to enable UPI payments. On April 21, 2022, UPI was launched in the UAE for the first time through Mashreq’s NeoPay.

France

From February 2024, UPI services will be available at the Eiffel Tower. UPI facilitates Indian tourists to make payments by scanning a QR code on the merchant’s website. This service is poised to expand to additional merchants in the tourism and retail sectors throughout France and Europe in the near future. Back in July 13, 2023, Indian Prime Minister Narendra Modi had announced that India and France had agreed to implement India’s UPI payment mechanism in France, starting from the Eiffel Tower.

This move will allow Indian tourists in France to make payments in Indian rupees, marking a significant development in bilateral trade and tourism between the two countries.

Notably, in 2022, the NPCI International Payments (NIPL) and France’s secure online payment system, Lyra, signed a MoU, further enhancing the groundwork for smooth and secure digital transactions between India and France.

Singapore

Starting February 21, people living in Singapore and India can instantly transfer money to each other via UPI and PayNow, each other’s equivalent. According to reporting from the Hindustan Times, “the cross-border real-time payment systems linkage was launched at 11am on Monday [February 20] led by Reserve Bank of India (RBI) governor Shaktikanta Das, and Ravi Menon, managing director of the Monetary Authority of Singapore [MAS]. Prime Minister Narendra Modi and Singapore Prime Minister Lee Hsien Loong virtually attended the launch event.”

Residents in India can now transact with people in Singapore via payment apps linked to a mobile phone number that use the UPI interface, like Google Pay.

Nepal

Nepal became the first foreign country to deploy UPI as a payment platform. NIPL partnered Gateway Payments Service (GPS), an authorised payment system operator in Nepal, and Bengaluru-based Manam Infotech. UPI will be deployed in Nepal as a digital public benefit to bolster interoperable real-time person-to-person (P2P) and to-merchant (P2M) payment transactions.

Bahrain

Bahrain has expressed interest in having in place a payment integration system like the Indian UPI and Singaporean PayNow linkage. Initial discussions have taken place; fintech is a clear priority for the small Gulf kingdom.

Bhutan

Bhutan has become the first country to adopt India’s UPI standards for its quick response (QR) code. It is also the second country after Singapore to have BHIM-UPI acceptance at merchant locations. On July 13, 2021, UPI was made available to the Royal Monetary Authority of Bhutan. BHIM (Bharat Interface for Money) is India’s digital payment application that works through UPI, a system that powers multiple bank accounts into a single mobile application.

Europe

NIPL has entered into a partnership with European payment services facilitator Worldline, with the intention of expanding acceptance of Indian payment channels across Europe. Under the partnership, Worldline’s QR code-based mechanism will allow merchants’ Point-of-Sale (PoS) systems in Europe to accept UPI payments from Indians using their mobile phones.

At a later stage, the Indian customers will also be able to use their RuPay debit or credit cards to make payments in Europe.

Apart from enabling Indians to travel hassle-free and enjoy seamless payments infrastructure, this step will also augment the customer-related benefits available to European merchants due to an increase in footfall and spending from Indian tourists.

In it’s press release, NIPL stated that it will target markets such as BENELUX – Belgium, the Netherlands and Luxembourg – and Switzerland. It will expand further with the roll-out of Worldline QR in more European countries.

UK

To further strengthen its cross-border payment solutions, TerraPay, a leading global payments infrastructure group announced its partnership with NIPL on September 22, 2022. This partnership intends to enable Indian customers and merchants in India with an active UPI ID to make and accept cross-border payments seamlessly by leveraging TerraPay’s agile infrastructure and the UPI network.

Oman

The Memorandum of Understanding (MoU) signed between Central Bank of Oman(CBO) and NIPL in October 2022 will enable Indian RuPay cards and the UPI platform in Oman to facilitate seamless digital remittances, which will benefit Indian workers and professionals.

According to the Indian Embassy in Oman, there are about 624,000 Indians in Oman, ofwhich about 483,901 are workers and professionals as of May 2021.

Singapore

In July 2022, the Reserve Bank of India (RBI) signed an agreement with the Monetary Authority of Singapore to implement interoperability between UPI and PayNow. The UPI-PayNow linkage will enable users of each of the two fast payment systems to make instant, low-cost fund transfers on a reciprocal basis without a need to get onboarded onto the other payment system.

PayNow is the fast payment system of Singapore, which enables peer-to-peer funds transfer service, available to retail customers through participating banks and Non-Bank Financial Institutions (NFIs) in the country. It enables users to send and receive instant funds from one bank or e-wallet account to another in Singapore by using just their mobile number, Singapore NRIC/FIN, or VPA.

Malaysia

In 2021, Malaysia’s Merchantrade Asia, collaborated with NIPL, to allow sending remittances through UPI to India.

India, Russia discuss use of RuPay and Mir cards and UPI-FPS interaction

High-level discussions are ongoing between India and Russia to establish mechanisms to ease cross-border payments. This includes mutual acceptance of RuPay (India) and Mir cards (Russia) to make payments in Indian rupees and the ruble in their respective markets.

Also being explored is the interaction of India’s UPI system and the Faster Payments System (FPS) of the Bank of Russia.

Russian officials have also discussed India’s adoption of the Russian financial messaging system, Services Bureau of Financial Messaging System of the Bank of Russia, to make cross-border payments.

India, Thailand discussing linkage between UPI and Prompt Pay Service

In November 2023, Nagesh Singh, ambassador of India to Thailand, noted that efforts were underway to link India’s UPI and Thailand’s Prompt Pay Service. Thailand is an important trade partner in Southeast Asia, accounting for 16 percent of India’s total trade with the region. Thailand is also a prominent destination among Indian outbound travelers – from November 10, 2023 to May 10, 2024, Indians have been allowed visa-free stay for 30 days. In the first 10 months of 2023, Thailand hosted over 1.3 million Indian tourists, an impressive 86 percent increase over the same period in 2022.

NRE or NRO accountholders with international mobile numbers allowed to register and transact on UPI platforms

As per a January 10, 2023 circular from the NPCI, UPI platforms will be able to onboard non-resident accountholders (NRE/NRO accounts) from 10 countries with international mobile numbers if they satisfy certain conditions. NRIs use NRE accounts to transfer foreign earnings to India, while NRO accounts helps them manage their income earned in India.

Their banks must ensure the NRE/NRO accounts meet Foreign Exchange Management Act (FEMA) regulations and guidelines released from time to time by the Reserve Bank of India (RBI) besides guarding against money laundering or terror financing.

This means that NRIs seeking to transact via UPI platforms in these stipulated countries would not require an Indian mobile number. It will help international students, family living abroad, and local businesses.

Partner banks have till April 30, 2023 to comply with the NPCI directions.

List of 10 countries where NPCI will enable international mobile number-linked UPI transactions

Since its launch in 2016, the popularity of UPI in India has been steadily growing. According to a report by PwC, it is projected that daily UPI transactions will reach 1 billion by FY 2026-27, representing approximately 90 percent of all non-cash transactions.

The year 2024 started with UPI transactions processed in January reaching a record high of INR 18.41 trillion. This was consecutive months of UPI transaction spends crossing the INR 18-trillion-mark, following the INR 18.23 trillion worth transactions processed in December 2023.

Year-on-year growth in UPI transactions has consistently exceeded 40 percent for transaction value and remained above 50 percent for transaction volume in 2023 and FY24 to date. In FY23, the UPI platform facilitated 83.76 billion transactions totaling INR 139 trillion. In 2023 alone, over 11.76 billion UPI transactions worth INR 182.25 trillion were processed, marking a 59 percent increase in volume and a 45 percent increase in value compared to 2022.

RBI data indicates that UPI transactions reached a total of INR 139.2 trillion in FY 2022-23, accounting for around 73 percent of all non-cash transactions in India during 2022. NPCI data reveals that approximately 74 billion UPI transactions worth INR 125.94 trillion were conducted in the calendar year 2022, a nearly 90 percent growth in transactions and a 76 percent increase in the average transaction value compared to the previous year.

(This article was originally published October 12, 2022. It was last updated February 29, 2024.)

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