Synopsis
- PM Modi encouraged BRICS nations to consider adopting UPI for financial integration and efficiency.
- The UAE has implemented UPI, and Maldives plans to adopt it, following partnerships to enhance digital payment infrastructures.
- India’s digital transaction rate rose to 40-48% in 2024, though cash remains at 60%.
In a call for stronger financial ties, PM Narendra Modi has invited BRICS countries to adopt India’s digital payment system, Unified Payments Interface (UPI). With the UAE already using UPI and Mauritius showing interest, PM Modi aims to extend UPI’s benefits of secure, real-time payments across BRICS nations.
Highlights on UPI Expansion and International Collaboration
- UAE: UPI officially launched in Dubai on March 28, 2023, through a collaboration between Dubai-based Mashreq Bank and NPCI International Payments Limited (NIPL). This rollout enabled Neopay terminals across Dubai to accept UPI, allowing Indian residents and tourists to use UPI seamlessly.
- Mauritius and BRICS Expansion: PM Modi mentioned Mauritius’s interest in adopting UPI, which could pave the way for broader UPI integration among BRICS countries, enabling smoother transactions and encouraging digital finance within the group.
Also Read: Expansion on UPI: List of Countries Now Accepting UPI
Maldives Joins the UPI Movement
The Maldives recently decided to take steps toward adopting UPI, following a recommendation from its Cabinet. This decision was influenced by India’s offer to assist in establishing digital financial services during Maldivian President Mohamed Muizzu’s recent state visit to India.
- Benefits Expected for Maldives: The Maldivian government anticipates that UPI will boost financial inclusion, simplify transactions, and support the nation’s digital infrastructure.
- Implementation Plan: President Muizzu proposed forming a consortium to manage UPI integration, involving local banks, telecom providers, and fintech companies to streamline the rollout.
Shift to Digital Payments in India
A recent study underscores India’s shift towards digital transactions, with cash usage gradually declining.
Research Insights: A study from the Reserve Bank of India (RBI) highlights this trend, noting that the average UPI transaction value decreased from ₹3,872 in 2016-17 to ₹1,525 in 2023-24, indicating UPI’s popularity for smaller, everyday transactions. The COVID-19 pandemic further accelerated digital payment adoption as people opted for safer, contactless methods.
Digital Growth Trend: Digital payments in India surged from 14-19% in March 2021 to approximately 40-48% by March 2024. While cash still constitutes around 60% of all transactions, its usage is diminishing.
