RBI’s UPI push: G20 travellers can use UPI for payments at select airports

The Reserve Bank of India has said that it will allow all inbound travellers to use Unified Payments Interface (UPI) payments for their merchant payments while they are in the country. The facility will be first introduced for travellers from G20 countries arriving at select international airports, RBI Governor Shaktikanta Das said on Wednesday.

“It's now proposed to permit all inbound travellers to use UPI payments for their merchant payments while they are in the country. To begin with, this facility will be extended to travellers from G20 countries arriving at select international airports," said RBI Governor Shaktikanta Das. 

He added that in the near future, this facility would be enabled across all other entry points in the country, for which operational guidelines would be issued shortly.

The UPI medium of payment has become hugely popular since the pandemic. According to National Payments Corporation of India (NPCI) data, payments using UPI were at Rs 12.98 lakh crore in value in January, as compared to transactions worth Rs 12.82 lakh crore reported in December 2022. NPCI noted that a total of 385 banks went live on the UPI platform in January, up from 382 in December 2022.

The RBI governor added that UPI had become an ubiquitous payment instrument for retail electronic payments in India. "An enhancement has recently been made to provide UPI access to non-resident Indians who have international mobile numbers linked to their NRE / NRO accounts. It is now proposed to permit all inbound travellers to India also to access UPI for their merchant payments (P2M) while they are in the country," Das said.

The volume of UPI transactions increased by 2.6 per cent to 803 crore transactions in January 2023. The network, as per NPCI data, processed around 6,752 crore transactions worth Rs 113 crore in fiscal 2022-23. In December 2022, UPI touched its highest-ever mark with 782 crore transactions.

The Economic Survey 2022-23 released last week showed that of the total 8,840 crore digital financial transactions in India—with a total value of Rs 126 lakh crore—around 52% were made via Unified Payments Interface (UPI) in FY22. The Union government also lowered the allocation meant for compensating fintech startups and banks that facilitate free UPI transactions, disappointing industry stakeholders who had been demanding a significant increase from last year’s outlay.

The RBI has brought many changes to the UPI platform. In December, NPCI asked the UPI ecosystem to allow users from some countries with non-resident account types like non-resident external (NRE) and non-resident ordinary (NRO) accounts with international mobile numbers to transact through UPI. With this, now Indians staying abroad can make payments through UPI even with having a domestic mobile connection. 

"RBI Governor Shaktikanta Das announced that the central bank is proposing to allow all inbound travelers to India to use UPI for merchant payments during their stay in the country. The initiative will initially be rolled out for travellers from G20 countries at selected international airports. This proposal can be extremely beneficial as it will make it easier and more convenient for international travellers to make payments while in India, without having to carry large amounts of cash or convert their money into the local currency. Additionally, using UPI will provide travellers with a secure and seamless payment experience, and further boost the growth of the digital payments ecosystem in India," said CA Manish P. Hingar, Founder, Fintoo.

"The move of extending UPI for inbound travellers from the G20 countries comes at a strategic point after announcing the UPI facility for NRI with NRE and NRO accounts linked with their mobile numbers. With G20 India Summit coming up, this step will turn out to strengthen India’s position as the payments leader in the global market. Inbound travellers from G20 countries will be able to experience UPI payments while transacting with different merchants. Once these travellers arrive in India, they will be able to avail of the facility by complying with the necessary procedure set by RBI at the airports and select entry points. India’s UPI is one of the most successful electronic payments systems globally. Therefore, the extension of UPI services to citizens of G20 countries will foster India’s relationship with these nations for future collaborations," said Swapnil Jambhale, Co-founder and COO, Safexpay.

"India is a forerunner in digital payments and UPI has played a significant role in this. RBI’s decision to extend UPI services for inbound travellers to India from G20 countries is a significant move which will enable these travellers to experience the UPI ecosystem. This announcement is in-line with the steps undertaken by NPCI to take UPI global, including the extension of UPI on-boarding and transaction facility to Non-Resident account types like NRE/NRO. Travellers from G20 nations will be able to make merchant payments via UPI with the help of their international mobile numbers. Once, these travellers arrive at select international airports, they will be required to comply with certain processes and procedures set out by RBI in order to avail UPI payments facility. Foreigners coming to India often face difficulty to make digital transactions as they do not have Indian mobile numbers or bank accounts. With this, both travellers and merchants will benefit due to an advanced digital payments acceptance ecosystem being set up by the Government," said Mandar Agashe, Founder, MD and VC of Sarvatra Technologies.

“We welcome the move by the Indian government that travellers from G20 countries will soon be able to use UPI in India. This will allow users to make payments to merchants, transfer money and make other transactions in India. This is an outstanding move by the Government to highlight the country’s digital growth. UPI has been a game changer for India and this will only highlight to the world that India is leading the way in terms of technology developments. UPI has become ubiquitous in the country due to its simple, fast, secure, and convenient method of transacting. It is a supporting statement to the 2023 Union Budget that highlighted the wider acceptance of digital payments with the remarkable performance of UPI clocking 7400 crores worth Rs 126 lakh crore in 2022,” said Dilip Modi, Founder, Spice Money. 

On Tuesday, PhonePe became the first fintech platform in India to allow payments abroad. With this, Indians travelling the UAE, Singapore, Nepal and Bhutan can now pay foreign merchants using UPI. Under this facility, foreign currency will be deducted from the user’s bank account, which is similar to international debit card transactions. PhonePe said all international merchant outlets in the UAE, Singapore, Mauritius, Nepal, and Bhutan that have a local QR code are supported. 

The announcement is significant as India will be holding G-20 presidency till November, when foreign delegates are expected to visit for multiple events in the country. In December, German Foreign Minister Annalena Baerbock, who was in India for a two-day official visit after India formally took over the presidency of the G20 grouping, reportedly bought traditional Indian clothes in Chandni Chowk and paid via digital payments app Paytm.

In response to the tweet, Paytm founder and CEO Vijay Shekhar Sharma welcomed the G20 delegates and asked them to enjoy the "world-class digital payment infrastructure" while promoting the company's slogan, "Paytm Karo".