The Unified Payments Interface (UPI) is expanding internationally, with successful implementations in Singapore and upcoming availability in countries like France. UPI enables seamless rupee payments for Indian travelers abroad. The process involves cooperation between payment operators in the home and overseas countries. Transnational UPI transactions may not be real-time, but partnerships like NPCI with Lyra in France ensure smooth operations.
For forex conversion, DBS provides an exchange rate to NPCI for UPI transactions in Singapore. NPCI adds a markup to this rate, which customers must consent to before the transaction proceeds. The settlement process involves crediting the total rupee amount to NPCI’s settlement bank, which then instructs DBS to credit the beneficiary’s bank in Singapore dollars. UPI may offer competitive rates and rewards due to fees earned by banks.
While UPI has potential for cross-border remittances and convenience, it must strengthen its value proposition to gain widespread popularity. Credit cards, despite higher fees, may still be preferred by affluent users. UPI’s success will depend on its ability to meet diverse user needs and compete with credit cards effectively.
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