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Bharat Interface for Money (BHIM), a mobile payments app that uses India’s Unified Payments Interface (UPI), is now live in the United Arab Emirates (UAE).
The launch was made possible by a collaboration between NCPI International Payments (NIPL), the international arm of the National Payment Corporation of India (NCPI), and NEOPAY, a unified merchant acquiring and consumer paytech subsidiary of UAE’s Mashreq Bank.
In a press statement, NIPL said the launch of BHIM UPI in the UAE will enable millions of Indian travellers to make seamless payments at NEOPAY-enabled shops and merchants.
“BHIM UPI has emerged as the preferred mode of payment of Indian citizens,” said Ritesh Shukla, CEO of NIPL, who hinted that the app could be heading to more overseas markets in future.
“We are dedicated to building a vast global acceptance network for UPI to ensure seamless user experiences when it comes to payments,” he said.
“NIPL is consistently working towards simplifying digital payments and driving digital public goods across the globe with our cutting-edge solutions.”
Since 2018, NIPL and Singapore’s Network for Electronic Transfers (NETS) have collaborated to enable the use of the BHIM UPI app to make QR code payments at selected NETS merchants, and to enable cross-border interoperability between both countries’ payment card schemes (NETS and RuPay) at selected merchants.
More recently, in September 2021, the Monetary Authority of Singapore (MAS) and the Reserve Bank of India have announced a payment linkage between Singapore’s PayNow and UPI, which is set to go live by July 2022.
The linkage will enable instant, low-cost fund transfers directly from one bank account to another between Singapore and India.
UPI and Indians overseas
Of all the markets that UPI could target outside India, the UAE is one of the biggest opportunities, given its large and growing Indian diaspora.
In 2020, according to the Population Division of the UN Department of Economic and Social Affairs (DESA), there were about 18m Indians living overseas, which is the highest number of expatriates of any nation.
Of those 18m, 3.5m were living in the UAE, followed by 2.7m in the United States and 2.5m in Saudi Arabia.
In the UAE, Indians were not only the country’s largest expatriate community, but they also made up about 30 percent of the UAE’s total population at the time.
Similarly, the UAE is the largest source of inbound remittances to India. In 2017, according to the Pew Research Centre, which uses Worldbank data, the UAE accounted for $13.8bn in remittances to India, exceeding the $11.7bn of second-placed US.
Mashreq puts down digital banking roots among Indian users
Fintech collaborations go both ways between India and the UAE, as can bee seen from a recent announcement by Mashreq NEO, Mashreq’s digital banking brand.
In April, Mashreq NEO announced a new partnership with India’s Federal Bank.
Through the partnership, Mashreq NEO will become the UAE’s first digital bank to facilitate non-resident account opening for Indian expatriates.
Mashreq said the new initiative leverages open banking technology to simplify the customer onboarding journey and deliver real-time account opening.
Moreover, Mashreq NEO customers will be able to make instant remittances to India via its Quick Remit facility.
NEOPAY emerges after year-long behind-the-scenes activity
In the UAE, NIPL said the launch of BHIM UPI is the result of a partnership between itself and NEOPAY that began in 2021.
However, NEOPAY did not officially launch as a subsidiary until March this year.
NEOPAY was launched as the merchant services arm of Mashreq Bank, therefore taking over its $22bn annual merchant acquiring business. NEOPAY will also take over the bank’s issuing and acquiring processing services, and will offer additional services in future such as buy now, pay later.
Thanks to Mashreq’s previous payments business, which increased its volumes by more than 50 percent in 2021 compared with 2020, NEOPAY is already one of the top three merchant acquirers in the UAE.
The strong position of NEOPAY in the UAE means that users of BHIM UPI will potentially be able to pay for goods and services across its 10,000-strong merchant base.
Since its launch in 2016, UPI has grown to become one of the world’s most widely-used digital payment platforms. In the financial year 2022, UPI enabled 45.6bn transactions worth a combined $1trn.
