India Seeks to Globalize Payment Systems, Keep Processing Local

The Reserve Bank of India will support internationalization of the country’s popular UPI digital payments system, part of its vision for the coming years.

“Enhanced interest evinced by major countries across the globe in India’s UPI could accelerate growth in trade and commerce with partnering countries while reducing speed and cost of remittances,” the central bank said in a Vision 2025 document. It will also explore expanding the SFMS financial messaging system across jurisdictions. 

The RBI expects the UPI platform to see average annualized growth of 50% in the next three years, and said measures it plans to take will triple the number of digital payment transactions. The body governing UPI signed an agreement this week to allow UPI in France after entering partnerships in Singapore and the UAE.

While the central bank looks at ways to promote India’s payment systems to other countries, it could consider mandating only domestic processing of payments. Payments providers are already required to store data locally, with credit card provider Mastercard seeing a nearly year-long ban on adding new customers lifted on Thursday after it complied with the rules. 

The central bank will also soon publish a discussion paper on the need for regulation of big technology companies in the payments ecosystem.