• Union Finance Minister Nirmala Sitharaman and her Bhutanese counterpart Lyonpo Namgay Tshering jointly launched BHIM–UPI in Bhutan.

• With this launch, Bhutan will become the first country to adopt Unified Payment Interface (UPI) standards for its QR deployment. Bhutan will also become the only country to issue and accept RuPay cards as well as accept BHIM-UPI.

• India launched indigenously-developed RuPay Card in Bhutan in 2019 and the phase 2 was launched in November 2020.

• It is expected to benefit more than 2,00,000 tourists from India who travel to Bhutan each year.

• The launch of BHIM-UPI in Bhutan will add a new milestone in financial integration between the two economies and the collaboration will enable acceptance of UPI-BHIM app in Bhutan.

• Royal Monetary Authority (RMA) of Bhutan will ensure that the participating NPCI mobile application through UPI QR transactions is accepted at all RMA acquired merchants in Bhutan.

What is Unified Payments Interface (UPI)?

• It is a system that powers multiple bank accounts into a single mobile application (of any participating bank), merging several banking features, seamless fund routing and merchant payments into one hood. 

• It also caters to the “peer to peer” collect request which can be scheduled and paid as per requirement and convenience. 

• It facilitates immediate money transfer through mobile devices round the clock.

What is BHIM-UPI?

• Bharat Interface for Money (BHIM)-UPI is a payment app that lets users make simple, easy and quick transactions using UPI. 

• Users can make direct bank payments to anyone on UPI using their UPI ID or scanning their QR with the BHIM app. 

• Users can also request money through the app from a UPI ID.

• It is developed by National Payments Corporation of India (NPCI).

National Payments Corporation of India

• National Payments Corporation of India (NPCI), an umbrella organisation for operating retail payments and settlement systems in India, is an initiative of Reserve Bank of India (RBI) and Indian Banks’ Association (IBA) under the provisions of the Payment and Settlement Systems Act, 2007, for creating a robust Payment & Settlement Infrastructure in India. 

• It was founded in 2008. 

• Considering the utility nature of the objects of NPCI, it has been incorporated as a “Not for Profit” company, with an intention to provide infrastructure to the entire banking system in India for physical as well as electronic payment and settlement systems. 

• The company is focused on bringing innovations in the retail payment systems through the use of technology for achieving greater efficiency in operations and widening the reach of payment systems.

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