BENGALURU: Following Singapore, the Reserve Bank of India (RBI) is in discussions with Indonesia, the United Arab Emirates, and Mauritius regarding the establishment of a direct payment link of the Unified Payments Interface (UPI) with networks in these nations in order to facilitate faster and cheaper mobile phone fund transfers.
On the sidelines of the meeting of G20 finance ministers and central bank governors, a senior RBI officer told reporters that some countries in Latin America have also expressed interest. At the event, the central bank is showing delegates UPI and the Central Bank Digital Currency (CBDC), also known as the digital rupee, and also allowing foreigners to use UPI.
In order to facilitate fund transfers, eliminate the high fees charged by banks, speed up the process, and cut costs, the government and regulator are eager to expand UPI payment links. The Indian diaspora is seen as particularly benefiting from the move.
The official from the RBI stated that the use of UPI for non-resident Indians will also be made possible next month. This will make it possible to use the tool with international phone numbers. Despite the fact that the tool was enabled, it was unable to be used because of technical issues.
When asked about the digital currency issued by the central bank, RBI officials stated that they are attempting to significantly expand the pilot to include as many cases as possible in a closed user group. On the retail side, pilots are taking place in a few cities, and the Reserve Bank of India (RBI) is now looking to include more banks and cover more areas.
“It was not intended to divert banks and other entities away from the existing Gilts order matching system in the Negotiated Dealing System. An official stated, "We are now looking into using a wholesale CBDC on the distributed ledger for other use cases, possibly money market transactions."