Nepal will be becoming the first country that will adopt India’s UPI system. It can play a pivotal role in the transformation of the nation’s digital economy of the neighbouring country, as per a statement by the NPCI (National Payments Corporation of India) on Thursday.
The NPCI International Payments Ltd (NIPL), which is the international arm of NPCI has now joined hands with the GPS (Gateway Payments Service), which is the authorised payment system operator in Nepal and Manam Infotech to provide the payment services in Nepal. Both the operators in Nepal will be deploying UPI (Unified Payments Interface).
This collaboration will help in serving the larger digital good for the people in Nepal and will bolster interoperable real-time person-to-person (P2P) along with the Person-to-Merchant (P2M) transactions in the nation, as per the official statement.
Nepal will become the first country outside of India to adopt the UPI as the payment platform which is a huge step in driving the digitalisation of cash transactions and furthering the vision and objectives of the Government of Nepal and the Nepal Rashtra Bank as the central bank of the country. This collaboration with Nepal will help in enabling the last-mile consumers in Nepal to reap the various benefits of the open interoperable payment system driving the instant payment transfer between banks and merchant payments in real-time.
According to Rajesh Prasad Manandhar, CEO of GPS, this will also enable the way forward for the real-time cross-border P2P remittances between India and Nepal. The UPI services in India have created a significant amount of positive impact in terms of the nation’s digital payment transformation. He added that they are expecting the UPI services in Nepal will also play a pivotal role in the transformation of their digital economy and will fulfil the dreams of building a cashless society.
In 2021, the UPI services platforms enabled financial transactions worth Rs.3900 crore which is equivalent to USD 940 billion which is further equivalent to approximately 31 per cent of the nation’s GDP.
Ritesh Shukla, CEO of NIPL, in a statement, said that at NIPL they are committed to transforming payments by taking their robust payments solutions to the international markets and collaborating with the local payment system operators. They are confident that this initiative will stand as a testament to NIPL’s technological capabilities and vision of scaling their unique offerings internationally.
The real-time payment infrastructure of UPI will help in catalyzing the process of financial inclusion in Nepal and will help in the creation of more opportunities for businesses. It will aid in the modernization of the digital payment infrastructure of Nepal and will bring the convenience of digital payments to the people of Nepal.
UPI has been amongst the most successful real-time payments system all over the world, with its provision of simplicity, safety, and security in the P2P and P2M transactions in India. Nepal houses a population of around 30 million people. The mobile penetration of more than 135 per cent with 65 per cent of the Nepal population using smartphones will provide a foundation for seamless replication of the digital revolution of India in Nepal. The three companies will be working together in the next three months for the deployment of UPI in Nepal.