The Reserve Bank of India has said that it will allow all inbound travellers to use Unified Payments Interface (UPI) payments for their merchant payments while they are in the country. The facility will be first introduced for travellers from G20 countries arriving at select international airports, RBI Governor Shaktikanta Das said on Wednesday.
“It’s now proposed to permit all inbound travellers to use UPI payments for their merchant payments while they are in the country. To begin with, this facility will be extended to travellers from G20 countries arriving at select international airports,” said RBI Governor Shaktikanta Das.
He added that in the near future, this facility would be enabled across all other entry points in the country, for which operational guidelines would be issued shortly.
The UPI medium of payment has become hugely popular since the pandemic. According to National Payments Corporation of India (NPCI) data, payments using UPI were at Rs 12.98 lakh crore in value in January, as compared to transactions worth Rs 12.82 lakh crore reported in December 2022. NPCI noted that a total of 385 banks went live on the UPI platform in January, up from 382 in December 2022.
The RBI governor added that UPI had become an ubiquitous payment instrument for retail electronic payments in India. “An enhancement has recently been made to provide UPI access to non-resident Indians who have international mobile numbers linked to their NRE / NRO accounts. It is now proposed to permit all inbound travellers to India also to access UPI for their merchant payments (P2M) while they are in the country,” Das said.
The volume of UPI transactions increased by 2.6 per cent to 803 crore transactions in January 2023. The network, as per NPCI data, processed around 6,752 crore transactions worth Rs 113 crore in fiscal 2022-23. In December 2022, UPI touched its highest-ever mark with 782 crore transactions.
The Economic Survey 2022-23 released last week showed that of the total 8,840 crore digital financial transactions in India—with a total value of Rs 126 lakh crore—around 52% were made via Unified Payments Interface (UPI) in FY22. The Union government also lowered the allocation meant for compensating fintech startups and banks that facilitate free UPI transactions, disappointing industry stakeholders who had been demanding a significant increase from last year’s outlay.
The RBI has brought many changes on the UPI platform. In December, NPCI asked the UPI ecosystem to allow users from some countries with non-resident account types like non-resident external (NRE) and non-resident ordinary (NRO) accounts with international mobile numbers to transact through UPI. With this, now Indians staying abroad can make payments through UPI even with having a domestic mobile connection.
On Tuesday, PhonePe became the first fintech platform in India to allow payments abroad. With this, Indians travelling the UAE, Singapore, Mauritius, Nepal and Bhutan can now pay foreign merchants using UPI. Under this facility, foreign currency will be deducted from the user’s bank account, which is similar to international debit card transactions. PhonePe said all international merchant outlets in the UAE, Singapore, Mauritius, Nepal, and Bhutan that have a local QR code are supported.
Besides UPI, Governor Das said that the central bank will also initiate a pilot project to launch QR code-based coin vending machines in a bid to ease access to coins.