Page 43 - Banking Finance June 2023

ARTICLE

UPI 123PAY has four options for payment. increase acceptability of UPI abroad. NIPL on 27 January
1. App based functionality where a mobile phone 2022 signed MoU with Netherlands based Terra Payment
manufacturer can install UPI app through over-the-air Services that will help UPI users receive international
programming that can be used for payment. payments from around the globe in real time. To save the
cost borne by Indians living abroad when sending money back
2. Missed called based in which customer can use
home, NPCI is planning to move 32 million expatriate
dedicated merchant payment number by giving a
population from SWIFT to UPI.
missed call. The incoming authentication call will ask for
PIN verification to complete the transaction.
Service
3. Interactive Voice Response (IVR) based where the
Unified Payments Interface is a real-time payment system
payment transaction will complete using pre-defined
that allows sending or requesting money from one bank
phone numbers.
account to another. Any UPI client app may be used and
4. Payment in offline mode through sound based proximity
multiple bank accounts may be linked to a single app. Money
data communication.
can be sent or requested by using a user-created Virtual
Payment Address (VPA) or UPI ID that helps in sending or
Internationalization requesting money from a bank account using the know your
Around 777 million Indian consumers shop across the border customer (KYC) linked mobile number. UPI also generates a
in 2021. To make ease of payment, NPCI International specific QR code for each user account for the purpose of
Payments Limited (NIPL) signed memorandum of contact-less payment.
understanding (MoU) with UK based PPRO Financial on 17
November 2021 to expand the acceptance of UPI into Mobile apps
foreign markets especially in China and United States which
Any UPI app can use payment and transfer fund from and
accounts for half of all international transaction coming from
to UPI enabled banks. Apart from various third-party apps
India. On 26 January 2022, UK based fintech startup
such as Google Pay (previously Tez), PhonePe, Paytm,
Transact365 enabled UPI for global merchants with real
MobiKwik, Amazon Pay, Samsung Pay, WhatsApp Pay, NPCI
time currency conversion facility that will help them do
manages its own app called BHIM.
business in India independent of local presence. As per NPCI
and RBI mandate, banks, payment service providers (PSPs)
From 21 banks in April 2016, the total number of banks
and third-party application providers (TPAPs) in India must linked to UPI platform is 304 as of Feb 2022.
enable international acceptance through UPI from 30
September 2022.
In June 2021, NPCI removed the restriction placed on
WhatsApp on UPI customer on-boarding which until now
With the release of Payments Vision 2025 document on 17 was limited to 20 million (20 million) users. With 530 million
June 2022, RBI will push for internationalization of UPI with (530 million) registered users in the Indian market, WhatsApp
nations using United States dollar, Pound sterling and Euro can now formally introduce UPI to all its customers.
under bilateral treaties.
On-Device wallet
Remittance Since 50% of UPI transactions are below Rs. 200 with a
Due to increasing remittances to India, NIPL with Western higher frequency rate, it creates a large backlog of volume
Union is going to integrate UPI to help the Indian diaspora which increases the failure rate and affects the stability of
receive and send money abroad with ease. The service will the entire payment network. To save electricity consumption
become operational from second quarter of 2022.IndusInd and computing power of banks, UPI mobile apps will have
Bank and Thailand based financial service provider to support on-device wallet features as per the RBI directive
DeeMoney will use UPI ID to verify customers in India for from December 2021. The in-built wallet will help in low-
cross border transaction. This is part of Money Transfer value instant payment by using the infrastructure of the
Operator (MTO) partners programme of NPCI.IndusInd Bank mobile app developer, thus decreasing the load on banks
is planning to collaborate with more foreign entities to through decentralization of back-end infrastructure and

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