The international branch of the National Payments Corporation of India (NPCI), which operates the highly popular United Payment Interface instant payments platform, is in talks with countries in South America and Africa to help them develop a similar system.
The NPCI’s International Payments Ltd (NIPL) has met with leaders from over 20 countries but it is close to reaching a deal with a particular nation, though it declined to elaborate further. According to Reuters, Rwanda is the potential candidate and “serious discussions have happened.”
NIPL has indicated it would use UPI as the template for the new systems, with those platforms potentially being implemented within approximately three years. NIPL has already signed agreements with Peru and Namibia, and the instant payments platforms in those countries are set to launch sooner.
Facilitating Inclusion
Instant payments platforms like UPI and Brazil’s Pix have flourished in countries without established banking systems. Instant payments systems can reduce a country’s dependence on cash and facilitate financial inclusion in underserved populations. They can also be a game-changer for small- to medium-sized businesses.
The strong demand for banking solutions has made UPI the most-used payment method in India. The platform processed 15 billion transactions last month, up 41% year-over-year. In addition to supporting payments at the point of sale, UPI can also expedite peer-to-peer payments.
Forging Links
NIPL is also working to forge more international links for UPI. The platform joined Malaysia, Thailand, Singapore, and the Philippines to form Project Nexus, under the scope of the Bank of International Settlements.
Project Nexus is the first step in creating a network for cross-border instant payments in South and Southeast Asia, and it is expected to launch in the next two years. Indonesia has also considered joining the project, and the EU participated in a trial run of the platform.
UPI already established a direct link with Singapore’s PayNow last year, enabling the two systems to tap the estimated $1 billion in cash flow between the countries. UPI has seven such links in place, and NIPL’s leadership indicated there are more to come.