Imagine being an Indian enjoying a vacation in a foreign country, trying out local cuisines and then- making payments dealing with currency exchange, carrying cash or international credit card became a hassle. By considering this factor, the Reserve Bank of India (RBI) has recently stated they will take the UPI and RuPay “truly globally” through fintech innovation.
RBI’s decision to take UPI and RuPay global
Last Wednesday, at the Global Fintech Fest 2024 event, the governor of RBI, Shaktikanta Das, stated that the central bank is deploying UPI-like infrastructure abroad, and working to make the UPI and RuPay global. This fintech innovation is set to revolutionize international transactions by making them faster, more secure and more accessible.
Das said that the central bank has already made some progress in making the UPI and RuPay global. The deployment of the UPI and RuPay is already happening in countries like Nepal, Bhutan, Sri Lanka, the UAE, Singapore, Namibia, Peru, Mauritius and France.
The RBI is also facilitating the QR code-based payment acceptance at international merchant locations. Indian tourists and business travellers can simply scan a QR code with their UPI app to make payments through secure payment services. This fintech innovation will eliminate the need for cash or credit cards in those countries where digital payments are widely accepted.
— ReserveBankOfIndia (@RBI) August 28, 2024 The RBI is also focusing on integrating UPI with the Fast Payment Systems (FPS) of other countries. This interlinking allowed individuals to transfer money quickly and efficiently between India and other countries through the secure payment services of UPI and RuPay. This is especially important for people who need to send money to or from India, such as migrant workers, students, or international businesses.
The governor of RBI also added that, the Central Bank Digital Currencies (CBDCs) is helping them to deliver credit or government assistance to landless tenant farmers, as well as providing carbon credits to other farmers. Das stated that the RBI is always open to collaborating with other countries to develop the CDBC to provide offline solutions.
Fintech Innovation for India
In the event, it is also mentioned by the governor of RBI that they will make use of the Digital Public Infrastructure (DPI) in the journey of fintech innovation to improve the financial services of India. In the DPI different frameworks like UPI, Aadhar and online bill payments are included.
The DPI could address emerging challenges like fraud, cyber threats, data privacy and other concerns mentioned by the governor of RBI at the Global Fintech Fest (GFF) event. Several advanced technologies like Blockchain and AI will integrated into the DPI for fintech innovation to enhance security and efficiency in financial services.
The governor of RBI said, “Unified Lending Interface (ULI) aims to enable lending institutions to offer frictionless and end-to-end digital credits by leveraging consent-based data and related services. A full course launch will be done in due course. The ULI and UPI will mark revolutionary states in India.”
What is UPI and RuPay?
The Unified Payment Interface (UPI) is a game-changing fintech innovation in India that allows every person to send and receive money instantly and securely directly from their banks through a mobile device. The National Payments Corporation of India (NPCI) launched the UPI in 2016 as a secure payment service and since then it has become a widely used digital payment system in India.
RuPay is an Indian domestic card payment network launched by the National Payments Corporation of India (NPCI) in 2012. The vision of RBI behind the launch of RuPay was to establish local, affordable, and secure payment services. RBI wanted to reduce the country’s reliance on international card networks like Visa and Mastercard by introducing RuPay Credit Cards, RuPay Debit Cards and the like.
Potential challenges for expanding UPI and RuPay globally
The Unified Payment Interface (UPI) is a game-changing fintech innovation in India that allows every person to send and receive money instantly and securely directly from their banks through a mobile device. The National Payments Corporation of India (NPCI) launched the UPI in 2016 as a secure payment service and since then it has become a widely used digital payment system in India.
RuPay is an Indian domestic card payment network launched by the National Payments Corporation of India (NPCI) in 2012. The vision of RBI behind the launch of RuPay was to establish local, affordable, and secure payment services. RBI wanted to reduce the country’s reliance on international card networks like Visa and Mastercard by introducing RuPay Credit Cards, RuPay Debit Cards and the like.
Potential challenges for expanding UPI and RuPay globally
Data privacy concern – Handling cross-border transactions through UPI and RuPay increases the complexity of maintaining data security and privacy for secure payment services.
Regulatory compliance – Ensuring UPI and RuPay comply with different countries’ data protection laws, consumer protection laws, and others might be complex for RBI.
Cyber security threats – The expansion of UPI and RuPay globally might increase the chance of cyberattacks that can lead to threats of protecting user data and privacy.
Network reliability – Doing fintech innovation through UPI and RuPay across borders might be challenging for the central banks of India if there is a lack of reliable and fast network connections and robust technological infrastructure.
FAQ
What is UPI?
The Unified Payment Interface (UPI) is a game-changing fintech innovation in India that allows every person to send and receive money instantly and securely directly from their banks through a mobile device.
What is RuPay?
RuPay is an Indian domestic card payment network launched by the National Payments Corporation of India (NPCI) in 2012.
Is RBI expanding UPI and Rupay to an international level?
Yes. Last Wednesday, at the Global Fintech Fest 2024 event, the governor of RBI, Shaktikanta Das, stated that the central bank is deploying UPI-like infrastructure abroad and working to make the UPI and RuPay global.
What are the potential challenges for UPI and RuPay’s global expansion?
Data privacy concerns, regulatory compliances, cyber security threats, network reliability and the like.
In which countries the central banks deployed UPI and RuPay?
The deployment of the UPI and RuPay is already happening in countries like Nepal, Bhutan, Sri Lanka, the UAE, Singapore, Namibia, Peru, Mauritius and France.
What is fintech innovation for India?
The central banks of India will make use of the Digital Public Infrastructure (DPI) in the journey of fintech innovation to improve the financial services of India to address emerging challenges like fraud, cyber threats, data privacy and other concerns.
