The concept of real-time secure online payments has become increasingly important in today’s digital society. With its Unified Payment Services (UPI), India has led the way in promoting digital payment transactions. UPI payments at semi-urban and rural stores in the country increased by 650% this year, according to a report from branchless banking and digital network ‘PayNearby’.
UPI report findings-up payments
This year, assisted financial transactions in semi-urban and rural retail stores in India saw a 25% and 14% increase in value and volume, respectively. In addition, micro-ATM and mPOS instruments were found to have seen a 25% increase in demand. Financial institutions and non-banking financial institutions also saw a sharp increase in EMI collections, indicating that lending and financing solutions were in high demand again, bouncing back to pre-pandemic levels.
With more citizens using assisted digital means for banking, entertainment, e-commerce, etc., and getting integrated into the formal economy, the report highlights a shift in consumer behavior. Further, the upswing in demand for the option of making e-payments at retail stores signifies the crucial role small retail outlets play in bridging the infrastructure gap and driving financial inclusion to the last mile.
India’s digital transformation & UPI are lauded by G20 delegates
The G20 Sherpas and delegates recently praised India for its swift digital transformation. UPI system was used to make payments at the Shilpgram crafts village in Udaipur, Rajasthan and delegate from Saudi Arabia, Rasha Khalid Bin Aftan, expressed her delight saying: “I just purchased an item by using Google Pay. I am not even surprised. I know India is the pioneer of digital technology… We also had a session regarding digital technology… India is one of the best countries and all countries need to learn from India and its high technology.”
According to Indian G20 Sherpa Amitabh Kant, all delegates here purchased handicraft items using UPI and were surprised that they were paid within seconds.
UPI to get new feature from RBI
The RBI has announced they are introducing a new feature in UPI that allows customers to create payment mandates against merchants. This will enable them to request money from their bank account for specific purposes, when necessary. Further elaborating on the subject, Governor Shaktikanta Das said, “This single-block-and-multiple-debits functionality in UPI promises to enhance the ease of making payments in e-commerce and investments in securities.” The implementaion of this tool is expected to benefit online shoppers, purchasers of secondary capital and those signing up for the Retail Direct scheme. Additionally, it will also be applicable to government security transactions and other e-commerce deals.
In October, NIPL and the European payments facilitator ‘Worldline’ joined forces to allow Indians to use their mobile phones for UPI payments on merchants’ Point-of-Sale (PoS) systems in Europe. As part of the partnership, Indian customers will also be able to make purchases using RuPay debit and credit cards there.
As part of their agreement with Singapore-based Liquid Group, NIPL will enable UPI QR-based payments across 10 countries (North and Southeast Asia). Across the 10 markets of Singapore, Malaysia, Thailand, Philippines, Vietnam, Cambodia, Hong Kong, Taiwan, South Korea, and Japan, Liquid Group integrates a vast network of merchant acquiring partners.
In addition to these agreements, UPI has penetrated the payments landscapes of Nepal, Singapore, Bhutan, Malaysia, the UAE, France, UK, and Oman.
A collaboration between Nepal’s Manam Infotech and Gateway Payments Service made P2P, P2M, and cross-border payments possible there.
Bhutan: Bhutan became the first foreign country to allow UPI transactions through BHIM App in July 2021.
In July, RBI signed an agreement with the Monetary Authority of Singapore to implement UPI interoperability.
NIPL collaborated with Malaysia’s Merchantrade Asia, which enabled UPI-based remittances.
UAE: NIPL enabled UPI payments in UAE through its partnership with LuLu Financial Holding, Mashreq Bank, and Network International.
The agreement between Lyra Network and NIPL allowed students and tourists to pay via UPI in France.
In August, NIPL partnered with payment solution provider PayXpert to launch UPI payments based on QR codes in the UK.
In October, NIPL signed an agreement with the Central Bank of Oman to launch QR-based UPI payments.
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