In a significant move to promote regional financial integration and digital payments adoption, India launched its Unified Payments Interface (UPI) and RuPay card services in both Sri Lanka and Mauritius on February 12th, 2024. This expansion marks a key milestone in India’s efforts to position its homegrown payment platforms as global players, following the successful launch of UPI in France earlier this month.
The official launch ceremony, held virtually, saw the participation of Prime Minister Narendra Modi of India, the President of Sri Lanka, Mr Ranil Wickremesinghe and the Prime Minister of Mauritius, Mr Pravind Jugnauth. This high-level participation underscores the strategic importance placed on this initiative by all parties involved.
Driving Economic Growth Through Cross-Border Payments
The immediate impact of this launch is the facilitation of seamless and cost-effective peer-to-peer (P2P) transactions between citizens of India, Sri Lanka, and Mauritius. This is expected to boost tourism, trade, and remittances between these nations, contributing to their economic growth. With millions of Indian tourists visiting Sri Lanka and Mauritius annually, the convenience of using familiar payment methods like UPI and RuPay cards is likely to encourage tourism spending. Similarly, simplified cross-border trade settlements can potentially increase trade volumes between these countries.
“India’s UPI or United Payments Interface comes in a new role today – Uniting Partners with India” – Speaking at the launch, Prime Minister of India Mr Narendra Modi.
Beyond immediate economic benefits, the launch of UPI holds immense potential for promoting financial inclusion in both Sri Lanka and Mauritius. A significant portion of the population in these countries remains unbanked or underbanked. UPI’s user-friendly interface and low entry barriers can act as a gateway to formal financial services for these individuals, bringing them into the mainstream economy.
A Step Towards A Cashless Future
The launch of UPI and RuPay in Sri Lanka and Mauritius marks a significant step towards achieving the vision of a cashless and financially inclusive South Asia. It demonstrates India’s commitment to leveraging technological prowess to empower its neighbours and foster regional economic cooperation. As challenges are addressed and user adoption grows, this initiative has the potential to reshape the regional payments landscape and pave the way for a more integrated and digital future for South Asia.
Impact Of The UPI
India’s Unified Payments Interface (UPI) has taken the fintech scene by storm. Gone are the days of tedious and complicated bank transactions; instead, simple virtual payment addresses (VPAs) enable instant, cashless transactions anytime, anywhere. This user-friendly, affordable platform has brought millions into the banking and financial system, boosting inclusion. Merchants have also flourished, accepting secure QR code payments that eliminate cash handling risks and expand their reach.
Speaking about the convenience and speed of UPI transactions, the Prime Minister of India informed that more than 100 billion transactions took place via UPI last year worth INR 2 lakh crores or 8 trillion Sri Lankan rupees or 1 trillion Mauritius rupees. UPI’s impact extends beyond just transactions, fueling e-commerce growth and the digital economy with its instant, secure nature that builds trust among online shoppers.
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