News Highlight
NRIs from 10 countries can use UPI with their international mobile numbers.
Key Takeaway
- According to a notice issued by the National Payments Corporation of India(NPCI), non-resident account types such as NRE/NRO with international mobile numbers will now be able to transact using UPI.
- To begin, transactions will be permitted via mobile numbers in ten countries: Singapore, Australia, Canada, Hong Kong, Oman, Qatar, the United States of America, Saudi Arabia, the United Arab Emirates, and the United Kingdom.
Unified Payments Interface (UPI)
- About
- UPI is a mechanism that connects several bank accounts to a single mobile app from any participating bank.
- The National Payments Corporation of India(NPCI) created the interface.
- UPI is a payment mechanism that transfers money between two bank accounts via smartphone.
- UPI enables customers to pay directly from their bank account to various retailers, online and offline, without having to type credit card numbers, IFSC codes, or net banking/wallet passwords.
- It combines numerous banking services under one roof, such as smooth fund routing and merchant payments.
- It was established in April 2016.
- It has since become a popular choice among users for sending and receiving money.
- UPI is a mechanism that connects several bank accounts to a single mobile app from any participating bank.
Key features of UPI
- Invoice in the inbox
- This feature allows customers to review the invoice sent by the merchant before making a payment.
- It will assist customers in viewing and verifying credentials and determining whether or not they have come from the correct merchant.
- One-time mandate
- Customers, including merchants and individual users, can pre-authorize a transaction and pay later using UPI Mandate.
- It can be prepared and implemented quickly.
- The amount will be deducted and received by the merchant/individual user on the day of the actual purchase.
- Linking of overdraft account
- Customers can link their overdraft accounts to UPI and their current and savings accounts.
- Signed intent and QR
- This feature allows customers to verify the legitimacy of vendors by scanning QR or rapid response codes.
- It provides the user with information to determine whether or not the retailer is a verified UPI merchant.
- This adds another layer of security. Customers will be notified if the receiver is not secure via notifications.
What exactly has the NPCI permitted on UPI?
- The National Payments Corporation of India (NPCI) published a circular that prepared the path for more significant usage of the domestic payments network UPI.
- So far, UPI has only authorised Indian phone numbers, leaving out non-resident bank accounts tied to foreign phone numbers.
- Phone numbers from ten countries, including Singapore, Australia, Canada, Hong Kong, Oman, Qatar, the United States, Saudi Arabia, the United Arab Emirates, and the United Kingdom, were authorised to be used on UPI in the initial phase.
- According to NPCI, this could be extended to other countries as well.
How will it benefit Indians abroad?
- Non-resident Indians would be allowed to transact using UPI once the systems are in place, whether in India or abroad.
- Non-residents must have either a non-resident external (NRE) or a non-resident ordinary (NRO) account in India to utilise UPI.
- Given the size of India’s UPI merchant infrastructure, it would be more useful when account holders visited the country.
- While abroad, people can use UPI to send money to family members in India and use it on e-commerce sites that accept such payments.
The facility’s prerequisites
- NPCI has directed banks to accept only accounts that comply with the Foreign Exchange Management Act norms and directions given by RBI departments.
- Apart from that, both the remitter and the recipient banks must guarantee that they comply with anti-money laundering (AML) and fighting financial terrorism (CFT) checks.
UPI at the Global level
- The plan to tap NRIs is a step towards NPCI’s goal of making UPI a worldwide phenomenon.
- The initial list of ten countries will be expanded in the future.
- NPCI International Payments Ltd, a company established in 2020, has attempted to promote domestic payment systems in other countries.
- It has already partnered with payment system operators in Nepal, the UAE, France, the United Kingdom, and other countries to enable UPI adoption.
- There are also plans to connect UPI to Singapore’s Paynow.
Conclusion
- NPCI had received demands from the UPI ecosystem and customers to allow non-resident accounts to transact via UPI.
- As a result, they decided to allow it so that non-resident accounts with foreign numbers may have a seamless and instant UPI journey.
- Many NRIs who visit India but use their foreign phone number will benefit from the new trend.
Pic Courtesy: The Hindu
Content Source: The Hindu