India, Nepal launch UPI-based cross-border remittance system
What's the story
India and Nepal have launched a new cross-border remittance system, the Unified Payments Interface (UPI)-National Payments Interface (NPI). The initiative allows citizens of both countries to send money directly through mobile banking apps and digital wallets. The integration is expected to boost financial inclusion and deepen economic ties between the two nations.
Implementation details
Benefits for consumers and businesses
The technical integration of the UPI-NPI linkage was carried out by NPCI International Payments Limited (NIPL), the international arm of the National Payments Corporation of India, and Nepal Clearing House Limited (NCHL). This new payment corridor is expected to benefit both consumers and businesses. It will allow travelers to transfer funds instantly without carrying cash or dealing with currency exchange issues.
Merchant benefits
Increased transaction volumes for local merchants in Nepal
The UPI-NPI linkage is also expected to benefit local merchants in Nepal. They will get access to a large base of Indian digital payment users, which could increase their transaction volumes. The mechanism will also improve cash management for these merchants, reduce costs associated with handling physical currency, and ensure secure real-time settlement of transactions.
Transaction ease
Expanding UPI's footprint
The UPI-NPI linkage will eliminate the need for traditional banking channels, enabling instant cross-border fund transfers. Currently, UPI is accepted in nine countries, including Singapore, UAE, France, Mauritius, Nepal, Bhutan, Qatar, Sri Lanka, and Cambodia. This means Indian travelers can make payments abroad using their preferred digital payment platforms.