MUMBAI: To facilitate cross-border remittances between India and the euro area, the Reserve Bank has said the popular mobile payments system unified payments interface (UPI) will be interlinked with the European instant payment system, the Target instant payment settlement (TIPS).
“The RBI and NPCI International Payments (NIPL) have been engaging with European Central Bank on the initiative to connect UPI with the Target Instant Payment Settlement, the instant payment system operated by the Eurosystem. Following constructive and sustained engagement, both sides have agreed to start the realisation phase for the UPI-TIPS link,” the RBI said Friday.
The NPCI runs UPI, the country's most popular digital payments platform facilitating over 20 billion transactions a month worth around Rs 27 trillion.
The UPI is currently available in seven countries -- Bhutan, France, Mauritius, Nepal, Singapore, Sri Lanka and the UAE. This allows Indians to make payments while traveling or living in these countries, often through partnerships with local payment systems.
Bhutan was the first country to adopt UPI for international use, followed by France where it's accepted at select international locations and tourist spots, while in Mauritius it's accepted at beach markets, local shops, and tourist venues.
Nepal uses it for hassle-free payments by scanning QR codes at local venues and restaurants while in Singapore, the UPI is accepted at marketplaces, restaurants, and various other merchant locations. In Sri Lanka, all local shopping venues and merchant establishments accept it and in the UAE, it is widely available in shopping spots, restaurants, and popular tourist destinations.
The RBI has been taking initiatives to link the UPI with other countries as part of the G20 roadmap for enhancing cross-border payments. The regulator has been focusing to bring cheaper, efficient, more transparent and more accessible remittances to the vast diaspora.
“Reserve Bank of India has been actively pursuing interlinking of UPI with fast payment systems of other jurisdictions to promote cross-border payments,” the statement added.
The proposed UPI-TIPS interlinkage aims to facilitate cross-border remittances between India and the euro area and is expected to benefit users of both jurisdictions, according to the central bank. The RBI also said it will continue to collaborate closely with the European Central Bank through NIPL to operationalise the UPI-TIPS link, including technical integration, risk management and settlement arrangements.