RBI Policy: India-bound travellers to be allowed to use UPI: Governor

The Reserve Bank of India (RBI) has proposed to extend Unified Payments Interface (UPI) for merchant payments for travellers coming from abroad, said RBI Governor Shaktikanta Das while making Monetary Policy Committee (MPC) announcements on February 8.

The governor said that to begin with, this service will be permitted to travellers from G20 countries arriving at select international airports.

"UPI has become hugely popular for retail digital payments in India. It is now proposed to permit all inbound travellers to India to use UPI for their merchant payments (P2M) while they are in the country. To begin with, this facility will be extended to travellers from G-20 countries arriving at select international airports," Das said.

He also said that the RBI will launch a pilot project in 12 cities wherein a machine will vend coins based on QR codes. "These vending machines will dispense coins against debit to the customer’s account using UPI instead of physical tendering of banknotes," he said.

"This will enhance the ease of accessibility to coins. Based on the learnings from the pilot, guidelines will be issued to banks to promote distribution of coins using these machines," he added.

On February 7, PhonePe became India's first fintech platform to support international payments, allowing Indians travelling abroad to pay foreign merchants using UPI.

The transactions would work just as they would with an international debit card, and the foreign currency will be deducted from the user’s bank account.

According to the company, all international merchant outlets in the UAE, Singapore, Mauritius, Nepal and Bhutan that have a local QR code are supported.

The RBI on Wednesday hiked repo rate, the rate at which it lends short-term funds to banks, by 25 bps.