Few of the fintechs have already started getting queries from international banks, financial institutions and governments. Most of the queries are coming from Singapore, UAE, China, Africa, Egypt, Nigeria, Sri Lanka, Philippines, Bangladesh and South East Asian countries.
Market players believe that any economy which does not have a strong card and net banking network will be open to the person to person (P2P) or account to account transfer technology of UPI. The biggest unique selling proposition for UPI is its two factor authentication feature which is not common in other economies.
Mandar Agashe, MD and Founder of Sarvatra Technologies said, “UPI is already a scaled up payment system which has proved its metal in such a complex economy like India. For other economies nothing is as complex as our challenges of languages, processes, multiple gadgets and the huge population. Others have to pick UPI customize it as per their banks and they are good to go.”
This opens immense business opportunities for these fintechs who can share their technology with other countries. “We have Philippines, China, Myanmar, Sri Lanka, Bangladesh and a lot of South East Asia since it is so fertile for innovation. People from all over, even China reach out to us on Linkedin,” said Anand Kumar Bajaj, Founder & CEO, PayNearby.
A demo of transactions made using the BHIM UPI started in Singapore on November 13. The project is expected to launch by February 2020. It is jointly developed by National Payments Corporation of India (NPCI) and Network for Electronic Transfers (NETS) of Singapore. Experts believe that Singapore is a transitory economy therefore launching UPI there will be very helpful. This can help in cross pollination of UPI for India.
“We know that many countries are vying for this technology. I can’t put a time-line, but keeping in mind theirs and ours eco-political climate but I think a two months integration, or it should be done by April 2020”, said Bajaj.
Reserve Bank of India Governor Shaktikanta Das has said that National Payments Corporation of India (NPCI) has setup a subsidiary to export the much acclaimed UPI for governments and central banks interested in implementing similar instant fund transfer in their countries.
Google has also written to US central bank to adopt a similar payment infrastructure as India citing the UPI example. Google vice president Mark Isakowitz has written in his letter, “UPI was thoughtfully planned and critical aspects of its design led to its success. The approach in India attained amazing results for banks, consumers and other players within the payments ecosystem and the central bank.”
UPI is an interoperable instant fund transfer technology created by NPCI that enables inter-bank fund transfer.
There are currently 140 member banks using the UPI rails to enable payments for customers across the banking sector. The NPCI is RBI’s payment governance arm and is owned by a consortium of top Indian banks. Since its launch in April, 2016, months prior to demonetization, UPI has become India’s fastest growing payment transfer interface clocking over 1 billion transactions worth around $27 billion in the month of November 2019.