NPCI plans to take UPI to Saudi Arabia, Bahrain, other Gulf countries: Report

India will soon take its Unified Payments Interface (UPI) service to Gulf countries, such as Bahrain, Saudi Arabia, and others. The discussions, initiated by the National Payments Corporation of India (NPCI), are in the early stages as many countries have shown interest.  

NPCI is trying to establish bank-to-bank transfer systems with Gulf countries in a bid to simplify cross-border remittances, a report in Mint stated. 

“NPCI is in initial discussions with a few Gulf countries for developing cross-border remittances using UPI, which will be primarily bank account-to-bank account transfers. The discussions have been facilitated by the Reserve Bank of India and other-country central bank collaboration, and by our Indian mission offices," said Dilip Asbe, NPCI managing director and chief executive, the report added. 

India has been trying to establish UPI links with other countries in a bid to establish a seamless payment system.  

Earlier this year, India and Singapore linked their national payments systems this year to provide a low-cost and safe pathway for annual remittances to the tune of over $1 billion.  

Bhutan became the first country to adopt the UPI system in 2021 and was quickly followed by Nepal in 2022.  

Earlier in January this year, NPCI said that non-resident account types like NRE/NRO that have international mobile numbers will be allowed to transact with UPI. 

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Transactions from mobile numbers of 10 countries will be enabled to begin with — Singapore, Australia, Canada, Hong Kong, Oman, Qatar, the United States of America, Saudi Arabia, the United Arab Emirates and the United Kingdom. Talks with UAE are at an advanced stage.  

These NRI accounts will be permitted to onboard and transact in UPI, provided the member banks ensure such accounts are only allowed as per the extant FEMA regulations and they adhere to the guidelines issued by the Reserve Bank of India. 

The NPCI noted that all onboarding and transaction level checks — such as cooling period and risk rules — with be applicable as per existing UPI guidelines. 

India is expected to cross 10 billion UPI transactions in June. Experts have said that this is happening due to the rapid digitisation of India's economy and the influence of technology in promoting financial inclusion, Subhrangshu Neogi, Executive Director & Co-Founder at Escrowpay told CNBC-TV18. 

According to a report by PwC India, The Indian Payments Handbook – 2022-27, UPI transactions are expected to reach a milestone of 1 billion transactions per day by 2026-27. 

The report stated that UPI is projected to dominate the retail digital payments landscape, accounting for 90 per cent of the total transaction volume over the next five years. 

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