• India’s Unified Payment Interface (UPI) services were rolled out in Sri Lanka and Mauritius on February 12.

• India’s RuPay card services were also launched in Mauritius at a virtual ceremony attended by Prime Minister Narendra Modi, his Mauritian counterpart Pravind Jugnauth and Sri Lankan President Ranil Wickremesinghe.

• The move enables the availability of UPI settlement services for Indian nationals travelling to Sri Lanka and Mauritius as well as for Mauritian nationals travelling to India.

• UPI has already gained acceptance in Singapore, UAE, Mauritius, Nepal and Bhutan.

• Earlier this month, UPI was launched at the iconic Eiffel Tower in Paris.

• RuPay is a global card payment network from India, with wide acceptance at shops, ATMs, and online. 

• The extension of RuPay card services in Mauritius will enable Mauritian banks to issue cards based on RuPay mechanism in Mauritius and facilitate usage of RuPay Card for settlements in India and Mauritius.

What is Unified Payments Interface (UPI)?

• Before 2016, India used a number of different systems to transfer money between banks. The traditional forms included National Electronic Funds Transfer (NEFT) and Real-Time Gross Settlement (RTGS). With the plethora of systems, rules and growing paper burden, there was a need for a unified system that could automate and standardise India’s payment platforms.

• In 2016, the National Payments Corporation of India (NPCI) set out with a mandate to change the face of India’s payment systems. It developed the Unified Payments Interface (UPI) as an architecture framework with a set of standard Application Programming Interface (API) specifications to facilitate online payments. 

• The aim was to simplify and provide a single interface across all NPCI systems, thereby creating interoperability and a superior customer experience.

• The pilot programme, with 21 member banks, was launched on April 11, 2016.

• The UPI 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.

Growth of UPI

• UPI transactions have experienced substantial growth, surging from Rs 92 crore in FY 2017-18 to Rs 8,375 crore in FY 2022-23, boasting a remarkable Compound Annual Growth Rate (CAGR) of 147 per cent in terms of volume.

• The value of UPI transactions has risen from Rs 1 lakh crore in FY 2017-18 to Rs 139 lakh crore in FY 2022-23, exhibiting a CAGR of 168 per cent.

• UPI emerges as the major driving force in the overall growth of digital payment transactions in the country accounting for 62 per cent of digital payment transactions in FY 2022-23.

National Payments Corporation of India

• National Payments Corporation of India (NPCI) was incorporated in 2008 as an umbrella organisation for operating retail payments and settlement systems in India.

• It is an initiative of the 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.  

• 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.

• NPCI is focused on bringing innovations in the retail payment systems through the use of technology and is working to transform India into a digital economy. It is facilitating secure payment solutions with nationwide accessibility at minimal cost in furtherance of India’s aspiration to be a fully digital society.

NPCI International Payments Limited (NIPL)

• NPCI International Payments Limited (NIPL) was incorporated on April 3, 2020, as a wholly-owned subsidiary of National Payments Corporation of India (NPCI). 

• As the international arm of NPCI, the NIPL is devoted for deployment of NPCI’s indigenous, successful Real-Time Payment System – Unified Payments Interface (UPI) and Card Scheme – RuPay, outside of India. 

• NIPL is focused on transforming payments across the globe with the use of technology and innovation. It will not only enable payment for Indians but also uplift other countries by enhancing their payment capabilities through technological assistance, consulting, and infrastructure.

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