NRIs can make payments in India via UPI platform

Most of us are familiar with the simplicity and convenience of UPI payments. The Unified Payments Interface (UPI) facility is offered by the National Payments Corporation of India (NPCI). The advantage is that funds can be transferred from one bank account to another or even from a wallet to a bank account with just an @ separated ID. That ID is mapped to a bank account, and based on this protocol; funds move from one bank to another bank free of cost. It has two advantages. Firstly, the transfer of money is instant, unlike NEFT payments which take up to a couple of hours to get executed. Account holders can use IMPS, but entails a cost while the UPI transfers are free of any cost.

There is only one challenge in UPI. You need a domestic India mobile number to be able to transfer funds using the UPI method. Hence NRIs having an India mobile number and a domestic account were able to do these transfers via UPI. However, for others, it was a problem, since global mobile numbers were not accepted by the NPCI for UPI transactions. That is all set to change now. NPCI has asked the Unified Payments Interface (UPI) ecosystem to allow users from selected countries access to the UPI facility even with their global mobile numbers. The NRI must be residing in one of these approved nations and mut have an NRE account or an NRO account mapped to these international mobile numbers.

What does that mean? In simple terms, it means that non-resident Indians (NRIs) in these selected countries will shortly be able to make payments in UPI without having to get an Indian mobile number. This would work in the case of an NRE account and also in case of an NRO account. As we know, a Non-Resident External (NRE) account is opened in India in the name of the NRI to park foreign earnings. On the other hand, the Non Resident Ordinary (NRO) account is opened in India in the name of an NRI to manage the income earned in India. Now both these accounts are eligible to be mapped to an international mobile number and the NRI can execute UPI transactions and transfer funds to India with a click.

To begin with, the NPCI has enabled just 10 countries with sizable Indian population to use this facility of transferring funds to India via UPI. NPCI will enable transactions from mobile numbers having country codes of Singapore, Australia, Canada, Hong Kong, Oman, Qatar, the US, Saudi Arabia, UAE. NRIs residing in these 10 countries would be able to use their foreign mobile numbers to map to their NRE / NRO accounts and directly send funds to India via the UPI route. The onus would be on the member banks to ensure that such accounts are only allowed as per extant Foreign Exchange Management Act (FEMA) regulations. In addition, the guidelines on anti-money laundering have also to be adhered to strictly.

The UPI ecosystem members has been given time to comply with NPCI's directions by April 30, 2023. UPI has been growing by leaps and bounds in the last few years and has become the default mode of transfer despite being launched only in the year 2016. In the month of December 2022, total payments via the UPI platform touched a record high of Rs12.82 trillion with a total of 782 crore transactions being conducted on the platform. The platform has especially become popular in the rural and semi-urban areas since money transfers happen across locations almost instantly. Extending this facility to NRIs would make the transfer of funds to India simpler and more economical.

UPI is an instant real-time payment system which facilitates inter-bank peer-to-peer (P2P) transactions. People don’t have to add accounts or wait for the NEFT to be activated. The transaction is done through mobile in easy steps with just an internet connection. Besides, there are no charges applicable for UPI transactions; with makes it economical and also delightfully cashless. As of date, a total of 381 banks are already live on UPI.