How India’s UPI is going global

How India’s UPI is going global and transforming digital payments

India’s Unified Payments Interface (UPI) is a revolutionary payment system that allows users to instantly transfer money between bank accounts using their mobile phones. Launched in 2016 by the National Payments Corporation of India (NPCI), UPI has become one of the most popular and successful payment systems in the world, with over 300 million monthly active users and over 6.7 billion transactions in September 2022.

But UPI is not just a domestic phenomenon. It is also spreading its wings across the globe, as several countries have adopted or are planning to adopt UPI standards for their own payment systems. UPI’s global expansion is a testament to its success and innovation as a payment system that offers convenience, security and interoperability. It also showcases India’s leadership and expertise in the digital payments domain and its potential to contribute to the global financial inclusion agenda.

UPI’s global journey

According to various sources, some of the countries that have been using or are planning to use UPI are:

Bhutan: In July 2021, Bhutan became the first country to adopt UPI standards for its QR deployment, and the first country in India’s immediate neighbourhood to accept mobile-based payments through the BHIM App. This enabled seamless cross-border payments between India and Bhutan, as well as enhanced trade and tourism between the two countries.

Nepal: In March 2021, Nepal deployed India’s UPI payment system, enabling real-time cross-border P2P remittances and merchant payments between Nepal and India. This facilitated cheaper and faster money transfers for Nepali migrant workers in India, as well as boosted bilateral trade and commerce.

Oman: In October 2022, Oman formally joined many other nations in adopting UPI for digital transactions across platforms, after signing an agreement with NPCI. This allowed Indian expatriates and tourists in Oman to make payments using their UPI apps at various merchants and service providers in the country.

UAE: In April 2022, NPCI announced that BHIM UPI has been made live at NEOPAY terminals, across the UAE, allowing Indian expatriates and tourists to make payments using their UPI apps. This also enabled UAE-based businesses to accept UPI payments from Indian customers, thereby enhancing cross-border trade and e-commerce.

Singapore: In November 2019, NPCI launched a pilot project with Singapore’s NETS to enable cross-border interoperability of payments using QR codes. In September 2020, NPCI partnered with Singapore’s PayNow to enable instant fund transfers between India and Singapore. This made it easier and cheaper for Indians living or working in Singapore to send money back home, as well as for Singaporeans visiting or doing business in India to pay using their mobile phones.

Mauritius: In August 2019, NPCI signed a pact with Mauritius’ Central Bank to launch a QR code-based payment system in the island nation. This enabled Indian tourists and businesses in Mauritius to make payments using their UPI apps, as well as facilitated financial inclusion and digital literacy among the local population.

France: In July 2019, NPCI collaborated with French payment company Lyra to offer UPI acceptance to merchants in France. This enabled Indian travellers and students in France to pay using their UPI apps at various shops and restaurants, as well as opened up new avenues for French businesses to tap into the Indian market.

United Kingdom: In August 2022, it was announced that UPI will foray into the United Kingdom market, with NPCI partnering with UK-based fintech company Fidel Technologies. This will enable Indian expatriates and tourists in the UK to make payments using their UPI apps at various merchants and service providers in the country.

NPCI has also been in talks with several other countries such as Qatar, Saudi Arabia, Malaysia, Thailand, Vietnam, Cambodia, Indonesia, Sri Lanka, Maldives, Bahrain, Hong Kong, Taiwan, South Korea, Australia, Japan, Switzerland, Netherlands, Canada, Russia and the European Union for expanding UPI’s reach and adoption.

UPI’s benefits and challenges

UPI’s global expansion offers several benefits for both India and its partner countries. 

Some of these benefits are:

Lower cost: UPI enables low-cost transactions by eliminating intermediaries and fees. This makes it affordable for users to send and receive money across borders without paying high charges or exchange rates.

Faster speed: UPI enables real-time transactions by leveraging existing banking infrastructure and mobile networks. This makes it convenient for users to pay and get paid instantly without waiting for hours or days.

Greater convenience: UPI enables seamless transactions by using simple identifiers such as mobile numbers or UPI IDs. This makes it easy for users to pay and get paid without sharing their bank details or card information.

Higher security: UPI enables secure transactions by using encryption and authentication mechanisms. This makes it safe for users to pay and get paid without worrying about fraud or theft.

Wider access: UPI enables inclusive transactions by reaching out to the unbanked and underbanked segments of the population. This makes it possible for users to pay and get paid without having a bank account or a card.

Better interoperability: UPI enables universal transactions by connecting different payment systems and platforms. This makes it flexible for users to pay and get paid using any app or device of their choice.

However, UPI’s global expansion also faces some challenges and risks that need to be addressed. 

Some of these challenges are:

Regulatory compliance: UPI needs to comply with the regulatory norms and standards of different countries and regions. This may require adapting to different legal frameworks, data protection laws, tax regimes, anti-money laundering rules, etc.

Technical integration: UPI needs to integrate with the existing payment systems and infrastructure of different countries and regions. This may require overcoming technical barriers, compatibility issues, scalability problems, etc.

User awareness: UPI needs to create awareness and trust among the potential users of different countries and regions. This may require educating them about the benefits and features of UPI, addressing their concerns and queries, resolving their grievances, etc.

Market competition: UPI needs to compete with the existing payment systems and players of different countries and regions. This may require offering better value propositions, incentives, innovations, partnerships, etc.

UPI’s future prospects

UPI’s global expansion is a remarkable achievement for India and a game-changer for the world of digital payments. It demonstrates India’s vision and capability to create a world-class payment system that can cater to the diverse needs and preferences of billions of users across the globe. It also reflects India’s commitment and contribution to the global goals of financial inclusion, digital empowerment, economic development and social welfare.

UPI has the potential to become a global standard for digital payments, as more and more countries adopt it for their own payment systems. It also has the potential to become a platform for innovation, as more and more players leverage it for their own products and services. It also has the potential to become a catalyst for cooperation, as more and more stakeholders collaborate with each other for mutual benefit.

UPI’s global expansion is an ongoing journey that will require continuous efforts and improvements from all the involved parties. It will also require constant vigilance and preparedness from all the concerned authorities. It will also require constant feedback and support from all the end-users.

UPI’s global expansion is an inspiring story that will inspire many more stories in the future.