Global Expansion of UPI is being championed by Anupam Mittal, the founder of Shaadi.com, who has urged for the Unified Payments Interface (UPI) to extend its reach beyond India. Mittal believes that UPI has the ability to challenge established payment powerhouses such as Visa and Mastercard. In a recent tweet, he underscored the transformative potential of UPI for the payments sector, highlighting its capability to remove transaction fees and facilitate smoother international payments.
He stated that UPI has enabled large-scale, effortless, and cost-effective transactions within India and posited that now is the time to confront companies like Visa and Mastercard, along with the banking sector, which often takes a slice of 2-5% from a multi-trillion dollar market. Mittal pointed out that India’s tech solutions are poised to serve the world, questioning what is delaying progress in this area, specifically addressing the National Payments Corporation of India (NPCI).
UPI, a product of the National Payments Corporation of India (NPCI), has transformed digital payments in India by facilitating instantaneous, real-time transactions with minimal or no costs. Unlike conventional payment systems that impose considerable fees on users and merchants, UPI has streamlined routine transactions, thus enhancing financial accessibility for a broader audience in the country.
Mittal’s comments arrive at a moment when there is a push for the international adoption of UPI by India. Countries including Singapore, the UAE, Sri Lanka, France, and Nepal have started to implement UPI-based frameworks, with discussions under way with several other nations. Both the Indian government and NPCI are focused on broadening the reach of UPI through international collaboration, aspiring to position it as a worldwide alternative to existing payment systems.
Traditional entities such as Visa and Mastercard, along with international banks, typically charge merchants a fee ranging from 2% to 5% per transaction, a burden that ultimately affects both businesses and consumers. Mittal contends that UPI’s no-cost approach has the potential to disrupt this established system, ultimately reducing digital payment expenses on a global scale.
While there are hurdles to overcome, such as obtaining necessary regulatory endorsements, developing currency exchange protocols, and ensuring compatibility across various systems, Mittal’s comments reflect an increasing confidence in UPI’s potential capabilities.
On a related note, to ensure that the UPI environment remains economical and accessible to all users, the government has introduced an incentive programme aimed at promoting low-value BHIM-UPI transactions from individuals to merchants (P2M). This initiative provides incentives to the acquiring bank and other parties involved for P2M UPI transactions valued at less than Rs 2,000 made with small merchants, offering a rate of 0.15% based on the transaction amount.
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