RBI said the facility will be enabled at all access points in the country in the future.
Experts believe that India’s UPI is one of the most successful electronic payment systems in the world. Therefore, extending its services to citizens of G20 countries will advance India’s relationship with these countries for future collaborations.
The Reserve Bank of India has proposed allowing foreign tourists to make merchant payments while in India through Unified Payments Interface (UPI).
UPI is a system that merges multiple bank accounts into one mobile application (from each participating bank), merging various banking functions, seamless fund routing, and merchant payments into one hood.
Experts believe that India’s UPI is one of the most successful electronic payment systems in the world. Therefore, extending its services to citizens of G20 countries will advance India’s relationship with these countries for future collaborations.
Rajsri Rengan, Head of Banking and Payments, India and the Philippines, FIS, said this is a great step to scale up the use of digital payments in India and improve their payment experience.
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It has been decided to allow access to UPI to foreigners and NRIs visiting India. To begin with, this facility is being extended to travelers from the G-20 countries at selected international airports for their merchant payments (P2M) while in the country.
RBI said this will be enabled in all access points in the country in the future.
Swapnil Jambhale, co-founder and COO, Safexpay said the move comes at a strategic point following the announcement of the UPI facility for NRI with NRE and NRO accounts linked to their mobile numbers.
“This move will prove to strengthen India’s position as a leader in payments in the global market. Inbound travelers from G20 countries may experience UPI payments while transacting with various merchants. Once these travelers arrive in India, they can avail the facility by complying with the necessary procedure established by RBI at the airports and selecting access points,” added Jambhale.
How will it work?
- Banks/non-banks allowed to issue Prepaid Payment Instruments (PPIs) can issue INR-denominated full-KYC PPIs to foreigners NRIs visiting India
- Such PPIs may also be issued in co-branding agreement with entities authorized to trade foreign exchange under FEMA
- The PPIs are issued after physical verification of the clients’ passport and visa at the point of issue
- The PPI Publishers shall ensure that such information and records thereof are retained with them
- The PPIs can be issued in the form of wallets linked to UPI and can only be used for merchant payments (P2M)
- The loading / reloading of such PPIs takes place against receipt of foreign exchange in cash or via a payment instrument
- The conversion to Indian rupee is only performed by entities authorized to trade foreign exchange under FEMA
- The outstanding amount at any time in such PPIs must not exceed the limit applicable to full KYC PPIs
- The unused balances in such PPIs can be exchanged into foreign currency or transferred ‘back to source’ (payment source from which the PPI is loaded), in accordance with currency regulations
What is G20?
The Group of 20 (G20) is an intergovernmental forum of the world’s major developed and developing economies.
It includes Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Republic of Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, UK, US and European Union (EU).
Meanwhile, payment transactions through UPI rose 1.3 percent on a monthly basis to a high of nearly Rs 13 lakh crore in January 2023.
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