Prime Minister Narendra Modi.
Prime Minister Narendra Modi, along with Singapore counterpart Lee Hsien Loong, on February 21 launched the cross-border connectivity of real-time digital payment systems via video conferencing.
The easy linkage between India’s Unified Payments Interface (UPI) and Singapore’s PayNow will allow residents across the two regions to undertake faster and cost-efficient transfers. “This linkage will provide a low-cost real-time payment option to people from both countries and increase remittance. This will benefit students, professionals, NRIs, and their families the most,” Mr. Modi said. The linkage will permit residents to transfer funds from India to Singapore using mobile phone numbers, and vice versa, using the UPI virtual payment addresses.
Tuesday’s launch was virtually attended by Reserve Bank of India (RBI) Governor Shaktikanta Das and Monetary Authority of Singapore (MAS) managing director Ravi Menon. Mr. Das and Mr. Menon carried out the first transaction of the cross-border system as well.
Mr. Modi noted about 74 billion transactions amounting to more than ₹126 trillion (approximately 2 trillion Singapore dollars) were done through UPI in 2022, hinting at the reliability and security of the platform that is cultivating trust among users.
“Many experts are estimating that very soon India’s digital wallet transactions are going to overtake cash transactions,” he said.
“A key emphasis of the Prime Minister has been on ensuring that the benefits of UPI are not limited to India only, but other countries too benefit from it,” the statement said. It added that India under the helm of PM Modi has emerged as one of the fastest-growing ecosystems for fintech innovation, and will help drive globalisation of India’s “best-in-class digital payment infrastructure”.
The UPI-based payment ecosystem has witnessed significant attention recently. In January, the National Payments Corporation of India (NPCI) enabled international (phone) numbers to be able to transact using UPI. Later, the Union Cabinet chaired by PM Modi approved incentivisation schemes for promoting low-value BHIM-UPI transactions in FY 2022-23.
In February this year, PhonePe, launched support for the “UPI international” payments, allowing Indian users travelling abroad to pay foreign merchants using UPI.
In the third quarter of 2022, India recorded over 23.06 billion digital payments — including UPI, debit and credit cards — worth ₹38.3 lakh crore. Out of these, UPI-based transactions amounted to ₹32.5 lakh crore in value.