“Many countries praised the CoWin app, which was created for vaccination during the first COVID period and Nepal has now adopted India’s UPI for digital transactions. It will bolster interoperable real-time person-to-person (P2P) and person-to-merchant (P2M) transactions,” said a PIB release breaking the news of Nepal adopting India’s UPI for digital transactions. The development comes days after tourists & migrants to the United Arab Emirates with Indian bank accounts became eligible to do payments via UPI at various shops, retail facilities and other merchants in the UAE. Apart from these two nations, UPI Global is already live in Singapore and Bhutan, and would enable Indian travellers to make easy payments.
The scale and speed with which UPI operates in India is unprecedented with over 155 banks currently live on the UPI platform. UPI had enabled 39 billion financial transactions amounting to commerce worth $940 billion in the year 2021, a figure equivalent to around 31% of India’s GDP. As per recorded data, such a massive number of transactions haven’t happened on a single platform anywhere in the world. BHIM-UPI even achieved a record of 452.75 crore digital payment transactions to the tune of Rs 8.27 lakh crore till February 28, 2022.
To take digital payment to every nook and corner of the country, various steps have been taken by MeitY. Incentive schemes like the promotion of RuPay Debit cards and low-value BHIM-UPI transactions (P2M) facilitate Banks in building a robust digital payment ecosystem, promoting RuPay Debit cards and BHIM-UPI digital transactions, across all sectors and segments of the population, and further deepening digital payments in India. Additionally, Incentive/cashback schemes were launched by MeitY for changing the customer/merchant behavior for faster adoption of digital payments in India. Some of them were BHIM Cashback schemes for Individuals & Merchants, BHIM Aadhaar Merchant Incentive Scheme, BHIM-UPI Merchant Onboarding Scheme Merchant Discount Rate (MDR) Reimbursement scheme. Another step towards improving digital infrastructure was the scheme titled “Pradhan Mantri Gramin Digital Saksharta Abhiyan (PMGDISHA)” to usher in digital literacy in rural India.The introduction of QR scanning for making digital payments has also contributed to increasing the number of digital payments over the last few years because of the added ease and flexibility.
The success lies in the flexibility as UPI offers users to pay through easy QR codes and quick PINs, while the world still struggles and stays on traditional methods, such as card systems, which are still dominant in developed states across the globe. Check payments are still very common in various parts of the European countries. UPI is simple and doesn’t require users to carry anything extra other than their smartphones. RuPay and UPI, together are beating cash and card-based transactions in the country with whopping margins. The continuation of this trend may lead to them taking over the global competitors like American express, VISA and Mastercard, and other Global Giants that have ruled the Indian payment systems for decades. UPI is becoming popular in other foreign countries at a right time, as absence of a similar Open, Simple & Powerful payments interface may leverage India’s position in the foreign markets.
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