Find out how Indians can make UPI payments abroad

The Unified Payments Interface (UPI) has emerged as a prominent payment system in India, affording users the ability to effect instantaneous money transfers, bill payments, and assorted financial transactions via mobile devices. Though primarily launched for domestic transactions, UPI has extended its scope to encompass international transactions for Indian nationals and Non-Resident Indians (NRIs).

Amit Gupta, Managing Director at SAG Infotech, explains how Indians can make UPI payments internationally.

Registration: The Indian user needs to have a bank account linked to a UPI-enabled mobile app. The app could be provided by their respective bank or a third-party UPI app. Users start by registering their mobile numbers. After that, they create their UPI ID and finally set a PIN to protect their account and authenticate when required. NRIs can use UPI with their international mobile numbers.

Linking bank account: The user provides their bank account details and undergoes the app’s authentication process to verify their identity. This allows the UPI app to access bank accounts securely. The necessary account details may include the user’s account number, IFSC code, and other relevant information.

Initiating an international transaction: Here is how you can make international money transfers:

Provide the recipient’s bank account number
International Bank Account Number (IBAN)
Bank Identifier Code (BIC), or any other necessary details for the destination country
Next, specify the transfer amount and select the currency. That’s it!
 

Currency conversion: If the international transaction involves currency conversion, the UPI app uses the prevailing exchange rate to convert the amount from the user's account currency to the destination currency. The app may provide real-time exchange rates sourced from reliable financial institutions or use a fixed rate set by the user[‘s bank. The converted amount is displayed to the user before confirming the transaction.

Verification and authentication: Once the transaction details are entered, the user authenticates the transaction using their UPI PIN or other authentication methods provided by the app. This step ensures the security and integrity of the transaction.

Transaction authorisation: The UPI app sends the transaction details and authentication information to the user’s bank for authorisation. The bank verifies the user’s details, checks for sufficient funds, and approves the transaction if all requirements are met.

Fund transfer: After receiving the green light from the user’s bank, the UPI app takes charge and initiates the fund transfer. It efficiently transmits all the relevant transaction details. That includes the recipient’s account information to the bank responsible for the international transfer.

Also read: Indians can benefit from using UPI abroad. But there are some gaps that you have to keep in mind

Confirmation and receipt: Once the fund transfer concludes successfully, the UPI app promptly provides the user a confirmation, validating the seamless execution of the international transaction. A transaction receipt may also be generated, serving as tangible proof of the completed transaction. The user can choose to store or share this receipt for their convenience and record-keeping purposes.

It’s important to note that the availability and functionality of international UPI transactions may vary across different UPI apps and banks. Some banks and apps may have specific tie-ups with international banking partners, while others may have limitations or restrictions on certain countries or transaction types. Therefore, it is advisable for users to check with their respective banks or UPI app providers for detailed information on international UPI transactions. Overall, the flowchart behind international UPI transactions involves user registration, linking bank accounts, initiating the transaction, currency conversion (if applicable), verification and authentication, transaction authorisation, fund transfer, and confirmation/receipt. By leveraging UPI’s infrastructure, Indians and NRIs can conveniently perform international transactions using their mobile devices, providing a seamless and efficient payment experience.

Charges: If you use UPI to transfer funds internationally. You may incur additional fees. These charges include currency conversion costs, foreign exchange fees, and fees assessed by intermediary banks participating in the transfer procedure. Confirming the charges connected with international UPI transactions with your bank or UPI service provider is best.

To facilitate international money transfers, individuals in India typically rely on other methods such as wire transfers, SWIFT transfers, online payment gateways, or remittance services provided by banks and authorised financial institutions. These services often involve currency conversion and transaction fees and comply with the regulations and guidelines of the respective countries involved.