The Unified Payments Interface (UPI) has not only become a cornerstone of India's financial development but also attracted applause from global figures like Bill Gates during the G20 summit in New Delhi.
Nilesh Choudhary, CEO & Founder of Aikyam Capital Investors, emphasizes the game-changing impact of UPI for Non-Resident Indians (NRIs). He highlights the ease of sending funds for critical and immediate needs like healthcare and education, even from thousands of miles away.
Traditionally, NRIs have relied on various methods to send money back to India, each with its own set of complexities and limitations.
“The introduction of the UPI for NRIs has been a game-changer, especially in terms of money transfers. UPI simplifies the entire process by enabling quick and easy transfers directly from a mobile device,” said Kunal Varma, CEO and Co-Founder, Freo.
NRIs can use UPI while staying abroad by linking their Non-Resident Ordinary (NRO) or Non-Resident External (NRE) accounts with a UPI-enabled app, added Kunal.
Advantages of UPI for NRIs
1)UPI transactions do not require the sender to input lengthy bank account details of the recipient. Instead, they can simply use a UPI ID or a QR code or phone number, which substantially reduces the chance of errors.
2) Lower cost of transactions.
3)UPI provides enhanced security features, which is a critical aspect of any financial transaction. The transaction process through UPI is secured with a two-factor authentication system, adding an extra layer of security compared to some traditional methods.
How NRIs can do UPI Payments
Bank Account Requirements
Ensure you have an NRO or NRE account with a bank in India that supports UPI transactions.
Mobile Number
Register your foreign mobile number with your bank account. This is crucial because UPI apps use mobile numbers for verification.
Choose a UPI App
Select a UPI-enabled app. Many Indian banking apps and third-party apps like Google Pay, PhonePe, Paytm, and others support UPI transactions.
Installation and Setup
Install the chosen UPI app on your smartphone. During the setup process, you will need to verify your mobile number. Since you're abroad, make sure the app allows verification via your foreign number, or you might need to use an Indian number initially for setup.
Link Bank Account
Link your NRO/NRE account to the UPI app. This usually involves selecting your bank from a list and letting the app fetch your account details automatically through your mobile number.
Set UPI PIN
You will need to set a UPI Personal Identification Number (PIN) for transactions. This is usually done by entering a one-time password (OTP) sent to your registered mobile number and then creating a UPI PIN.
Start Transacting
Once set up, you can start using UPI for payments and transfers. You can send money to other UPI users, pay bills, or make purchases online.
Limits and Regulations
Be aware of transaction limits and any regulatory requirements, especially those about foreign exchange regulations under FEMA (Foreign Exchange Management Act).
“It's important to note that while the process is relatively straightforward, some users may face challenges due to restrictions on the use of foreign mobile numbers or internet banking limitations imposed on NRO/NRE accounts,” said Kunal Varma.
Additionally, regulations and features of UPI for NRIs may change, so it's advisable to check with your bank or the app provider for the most current information, he added.
The integration of UPI with over 10 countries, including UAE, UK, Mauritius, and Singapore, demonstrates India's strategic vision for economic resilience.
Disclaimer: The views and recommendations made above are those of individual analysts, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.
First Published:
21 Feb 2024, 07:39 AM IST
FAQs
Advantages of UPI for NRIs
- UPI transactions do not require the sender to input lengthy bank account details of the recipient. ...
- Lower cost of transactions.
- UPI provides enhanced security features, which is a critical aspect of any financial transaction.
Can NRIs use UPI for transactions in India using their overseas mobile number? Yes, NRIs can use UPI from their registered overseas mobile number from the approved geographies, i.e. Australia, Canada, Hong Kong, Oman, Qatar, Saudi Arabia, Singapore, UAE, UK, and USA for INR transactions in India.
How will UPI benefit India? ›
Key advantages of UPI
UPI eliminates the need to carry cash or cards. You can perform transactions anytime, anywhere via your smartphone. Transactions can be initiated with a virtual payment address (VPA), reducing the hassle of entering long account numbers and IFSCs.
Is India's UPI globally extended? ›
The central bank with NPCI International Payments Ltd. (NIPL) will work towards taking UPI to 20 countries with an initiation timeline of 2024-25 and a completion timeline of 2028-29.
How will UPI work internationally? ›
When you're using UPI for payments abroad, you essentially make an international transfer from your bank. So, while apps like Google Pay or PhonePe do not charge any fee for UPI International, the costs come from the international transfers fee associated with your bank.
How UPI is best in the world? ›
A Brief Introduction on UPI ONE WORLD
Now experience the ease and convenience of UPI payments in India. For travelers visiting India, UPI ONE WORLD is the ultimate solution for hassle-free and secure digital payments. You can transact seamlessly with merchants & vendors across India that accept UPI Payments.
Can NRI have Google pay in India? ›
Yes, as per a circular issued by the National Payments Corporation in India (NPCI) on 10th January 2023, NRIs having NRE/NRO bank accounts in Indian banks can utilize UPI payment apps to send and receive money in India.
Which is the first country to accept UPI outside India? ›
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.
Is there UPI in the USA? ›
Geographic Coverage: UPI is a payment system used exclusively in India, while FedNow is a payment system used exclusively in the United States. UPI was launched in 2016 by the National Payments Corporation of India, and as of 2021, it is used by over 200 banks in India.
What are the advantages and disadvantage of UPI? ›
Comparison of UPI vs. Other Payment Methods
| Aspect | Unified Payments Interface (UPI) | Debit/Credit Cards |
|---|
| Transaction Speed | Near-instantaneous transactions | Quick transactions |
| 24/7 Availability | Yes | No |
| Compatibility | Works across different banks | Limited to specific banks |
| Integration of Multiple Bank Accounts | Yes | No |
7 more rowsJun 25, 2024
Interoperability: UPI is designed to be interoperable, meaning it works across multiple banks and payment service providers. This has led to widespread adoption, as users are not restricted to a specific bank or app. Wide Acceptance: UPI is accepted by a vast ecosystem of businesses, both online and offline.
Who owns UPI in India? ›
Unified Payments Interface, commonly referred to as UPI, is an Indian instant payment system as well as protocol developed by the National Payments Corporation of India (NPCI) in 2016. The interface facilitates inter-bank peer-to-peer (P2P) and person-to-merchant (P2M) transactions.
Can I use UPI with nro account? ›
Once an NRI has an NRE or NRO account, they can integrate it with UPI, enabling them to manage finances effortlessly. UPI's instant money transfer feature, operational 24/7, is a boon for NRIs, allowing them to transact across time zones without hassle.
Does UPI not work outside India? ›
Unified Payment Interface, commonly known as UPI, services are now available in multiple countries other than India. These include Sri Lanka, Mauritius, Bhutan, Oman, Nepal, France and UAE.
How many countries use Indian UPI? ›
Indians can now use the Unified Payments Interface (UPI) to make payments in seven countries. Following its launch in Sri Lanka and Mauritius, UPI payments are accepted in France, UAE, Singapore, Bhutan, and Nepal.
What are the benefits of UPI id? ›
Advantages of UPI:
Users can send and receive money in real-time, eliminating the need for cumbersome processes such as entering bank account details or providing IFSC codes. With UPI, transactions are as simple as sharing a UPI ID or scanning a QR code.
What are the advantages and disadvantages of UPI? ›
Comparison of UPI vs. Other Payment Methods
| Aspect | Unified Payments Interface (UPI) | Net Banking |
|---|
| Integration of Multiple Bank Accounts | Yes | No |
| Transaction Cost | Mostly free of cost | May have transaction fees |
| Accepted Internationally | Limited Countries | No |
| Security Features | Multi-factor authentication (PIN, biometrics) | Login credentials, OTP |
7 more rowsJun 25, 2024
Consumers: UPI opens up a more inclusive financial ecosystem, enabling instant, 24/7 transactions at virtually no cost. It supports a range of transactions from high-value payments to micro-transactions, increasing financial accessibility.
What is the difference between UPI and IMPS? ›
IMPS enables customers to send money immediately between bank accounts by using MMID (Mobile Money Identifier) and mobile numbers. On the other hand, UPI is a more advanced system that enables seamless and real-time fund transfers through a single mobile application, eliminating the need for multiple banking apps.
