UPI is a United Payments Interface that was launched in India in 2016. UPI is a payment system that allows money to be transferred between bank accounts by using a smartphone. UPI in Nepal will allow customers to instantly transfer money to anyone with a UPI-enabled bank account, without having to share their bank account number or other sensitive information. Transactions are made through a virtual payment address, which is essentially an alias for your bank account number.
UPI was developed by the National Payments Corporation of India and launched in 2016. Since its launch, UPI has gained immense popularity in India. In fact, it is now the second most popular payments app in the country. In the past, it has been difficult for people in Nepal to send and receive money from India. This is because of the lack of an efficient system that allows for secure and fast transactions. However, this is no longer the case with the introduction of the Unified Payment Interface (UPI) in Nepal.
1. UPI is a unique payment system that allows users to make and receive payments through their phones.
2. It is going to be introduced in Nepal in late 2022.
3. There are a number of benefits to using UPI in Nepal, including convenience, security, and speed.
4. UPI is the perfect payment solution for individuals and businesses in Nepal doing business with India.
Recent News on UPI In Nepal
Nepal has entered into an agreement with NPCI International and Manam Infotech based in India. With the agreement, there will now be an interconnected electronic payment network between various banks and financial institutions & payment service providers. You will also be able to receive funds directly from your bank account in Nepal through various payment service providers (such as Paytm, GooglePay, PhonePay, etc.) from India. Also, with the launch of this service, Nepalese will be able to pay easily by scanning QR codes when traveling to India. The same goes for the Indians traveling to Nepal.
The development for this service is in the initial phase. The mentioned services will be operational within the next three months and NPCI is gradually going to launch all the services operating in India.
Benefits & Limitations With The Introduction of UPI Nepal?
Nepal has been one of the most underdeveloped countries in the world. Despite this, the country has seen a recent surge in technological advancements. With the introduction of UPI Nepal, there are now several benefits and limitations to consider.
One of the benefits of UPI Nepal is that it allows for easier and faster money transfers. This is especially beneficial for those who frequently send or receive money to and from India. Although UPI can be used to make international transactions outside India provided both the sender’s and the receiver’s bank are registered with UPI, transactions are carried out in Nepalese rupees, and the sender and the receiver must link a valid mobile number.
Benefits:
- Increased transparency and accountability as all financial transactions with India are recorded and can be tracked.
- The UPI app can be used to make both P2P (person-to-person) and B2B (business-to-business) payments.
- UPI allows bank customers to make or receive payments through their smartphones without having to enter any bank account details.
Limitations:
- Only a few banks will offer UPI services in Nepal at first.
- There will be limited merchant locations that accept UPI payments.
- You will need to have a Nepali bank account to use UPI. UPI isn’t a wallet so you cannot use it without a bank account like Khalti or eSewa.
What does the Introduction of UPI mean For Nepal Financially?
Nepal has been one of the poorest countries in the world for many years. However, there have been some improvements in the past few years. In 2018, Nepal was removed from the list of Heavily Indebted Poor Countries (HIPC) by the International Monetary Fund (IMF). However, there are still many challenges that need to be addressed. One of these challenges is access to digital payment services internationally. The initiative for Nepali Dollar Card was done recently but there were many limitations associated with this. A dollar card in Nepal charges a fee for each transaction and there is a limit on the card which makes it unable to use for B2B transactions. This is fine for any small-scale user but meaningless for a large-scale business.
This year, Nepal joined the rest of the world in using a new form of payment called Unified Payment Interface (UPI). In the context of financial transactions through digital technology around the world, we have to admit Nepal is also moving forward gradually. The Governor of Nepal Rastra Bank, Shri Mahaprasad Adhikari is happy to inform the implementation of the massive campaign of the Government of Nepal towards “Cashless Economy”.
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