The Reserve Bank has recently issued instructions to allow travelers coming from the G20 nations to use the Unified Payments Interface (UPI) for online payments in India. India took over the Presidency of the multilateral engagement forum, G20, earlier this year. The G20 is an international grouping of the world’s major developed and developing economies.
The UPI is a system that provides access to multiple bank accounts on the mobile phone by providing the option to pay Indian merchants using the smartphone in a single app. With this system, users are able to complete transactions using their mobile phones through mobile applications.
On the 8th of February, RBI made an announcement approving access to the UPI system for the foreign nationals and NRIs visiting India. The RBI mentioned that the UPI facility will be provided to travelers coming from the G20 countries at select international airports. This was done to allow smooth transactions for their merchant payments during their stay in India. The RBI has also informed in their circular that it will later be enabled all across the country.
The circular also mentioned that these prepaid payment instruments (PPIs) are also open for co-branding arrangements with other entities that are authorized to deal in Foreign Exchange under FEMA framework. However, this form of payment wallet can only be used for merchant (P2M) payments. The RBI instructions are to come into force with immediate effect and the capacity of operations of this framework will be increased gradually.
Physical verification of passport and visa of the customers are essential for the issuance of these PPIs. The RBI also mentioned that the unused currency in the PPIs can be exchanged into foreign currency or can be transferred ‘back to original source’.