Can India's UPI Become A Global Model? Google Thinks So.

Can India’s UPI Become A Global Model? Google Thinks So.

India’s Unified Payment Interface, launched in 2016, has seen great success domestically. Transactions have surged, a number of payment service providers have built their platforms atop UPI and customers have quickly adapted to it. At last count, in November, 1.2 billion transactions took place via UPI adding up to nearly Rs 1.9 lakh crore, according to data from the National Payments Corporation. Now UPI, which was built by the NPCI and operates on an open-payments framework, is getting global attention. Google LLC has recommended that the U.S. Federal Reserve implement a real-time payments platform, on the lines of India’s UPI. In August this year, the board of governors of the Federal Reserve published a paper where it proposed to develop a new inter-bank 24x7 real-time gross settlement service in the US. The central bank invited suggestions from relevant stakeholders on what the design and features of the ‘FedNow’ Service could look like. The service may be rolled out by 2023 or 2024, the paper says.

In response, Google has cited the experience of the UPI model used in India. “UPI was thoughtfully planned and critical aspects of its design led to its success,” said Google.

“After just three years, the annual run rate of transactions flowing through UPI is about 19 percent of India’s Gross Domestic Product, including 800 million monthly transactions valued at approximately $19 billion,” Google’s Vice President said, adding that Google Pay, the company’s flagship payments application in India, is now one of the three leading UPI mobile applications.

UPI surpassed 1 billion transactions in October 2019.