Now you will be able to make payments abroad with PhonePe
Now you will be able to make payments abroad with PhonePe: UPI International will have to be activated in the app, the first app in India to provide such a service
Fintech major PhonePe is going to start an international payment facility through UPI. Through this, PhonePe users in India will be able to make payments to international merchants using UPI while travelling abroad. Currently, the countries that will be included in this feature include UAE, Singapore, Mauritius, Nepal and Bhutan. For this feature, UPI International has to be activated in the PhonePe app.
"Users will be able to make payments in foreign currency directly from their Indian bank - just like they do with international debit cards," PhonePe said in a statement. According to a fintech industry executive, the move appears to be an attempt by PhonePe to capture a piece of the larger forex market. This is a category where there is a direct opportunity for payment apps to make additional money.
Rahul Chari, Co-Founder and Chief Technology Officer of the company said, “Over the past 6 years, we have experienced the UPI payment revolution across India. UPI International is the first step towards taking the UPI experience to the rest of the world.'
Chari said that the launch of this feature will prove to be a "game-changer" and completely change how Indians make payments while travelling abroad.
Some other fintech apps may also launch cross-border UPI support in the coming months. UPI processed over 8 billion transactions last month. UPI International is on the roadmap of the existing NPCI. Onboarding merchants to accept UPI payments in foreign markets will be a test for India's NPCI as without merchants, UPI users will not be able to make payments.
This is not the first time that a mobile payment app has started serving its domestic users in international markets. Chinese company WeChat Pay and Alipay also provide similar services to their customers in many countries. However, even for Chinese players, onboarding merchants overseas has been challenging.
In the domestic UPI market, four apps - PhonePe, Google Pay, Paytm and CRD Pay hold 96.4% of the total UPI market share. It is led by PhonePe which accounts for around 49% of the total UPI transactions in India. Google Pay follows PhonePe with a 34% share, Paytm with an 11% share, CRED Pay with a 1.8% share and others (WhatsApp, Amazon Pay and banking apps) with a 3.5% share.
With the launch of UPI in 2016, there was a revolution in the world of digital payments. UPI gave the facility to transfer money directly to the bank account. Earlier there was a trend of digital wallets. There is a hassle like KYC in the wallet, while nothing has to be done in UPI.
The operation of RTGS and NEFT payment systems in India is with the RBI. National Payment Corporation of India (NPCI) operates systems like IMPS, RuPay, and UPI. The government mandated a zero-charge framework for UPI transactions from January 1, 2020.
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