UPI for foreign travellers, NRIs: Passport, visa physical verification must for issuance; RBI releases guidelines

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The Reserve Bank of India (RBI) on February 10, 2023, released guidelines on the issuance and use of Unified Payments Interface (UPI) by foreign travellers and Non Resident Indians (NRIs) visiting India. The central bank has recently allowed the UPI merchant payment facility to foreign travellers and NRIs coming to 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,” RBI Governor Shaktikanta Das said while announcing the outcome of the bi-monthly Monetary Policy Committee on February 8, 2023.

To start with, this UPI facility will be extended to travellers from G-20 countries arriving at select international airports. On February 10, 2023, the central bank released detailed guidelines for the issuance of UPI to foreign travellers.”The Master Directions on Prepaid Payment Instruments (PPIs) dated August 27, 2021 (updated as on November 12, 2021) has been updated by inserting paragraph 10.3 therein,” the central bank said in a notification on Friday.

RBI guidelines for Prepaid Payment Instruments (PPIs) to foreign nationals/non-resident Indians (NRIs) visiting India

1) Banks/non-banks permitted to issue PPIs can issue INR-denominated full-KYC PPIs to foreign nationals/NRIs visiting India (to start with, this facility will be extended to travellers from the G-20 countries, arriving at select international airports). Such PPIs can also be issued in a co-branding arrangement with entities authorised to deal in Foreign Exchange under FEMA

2) The PPIs shall be issued after physical verification of the passport and visa of the customers at the point of issuance. The PPI issuers will ensure that such information and record thereof are maintained with them, the central bank said.

3) The PPIs can be issued in the form of wallets linked to UPI and can be used for merchant payments (P2M) only.

4) Loading or reloading of such PPIs will be against receipt of foreign exchange by cash or through any payment instrument.

5) The conversion to the Indian rupee shall be carried out only by entities authorised to deal in Foreign Exchange under FEMA, RBI mentioned.

6) The amount outstanding at any point of time in such PPIs shall not exceed the limit applicable on full-KYC PPIs, it added.

7) Provisions of paragraph 13 on validity and redemption, as applicable, shall be adhered to. The unutilised balances in such PPIs can be encashed in foreign currency or transferred ‘back to source’ (payment source from where the PPI was loaded), in compliance with foreign exchange regulations, the central bank further added.

These instructions shall come into effect immediately, RBI said.

Can all foreign travellers use UPI in India?

To start with, this UPI facility will be extended to travellers from G-20 countries arriving at select international airports, as Das mentioned earlier. The Group of Twenty (G-20) comprises 19 countries (Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Republic of Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, United Kingdom, and United States) and the European Union.

“Going forward, this facility will be enabled across all other entry points in the country. Necessary operational instructions will be issued shortly,” the central bank said earlier.

“This development comes on the heels of the Government outlining the importance of tourism for India in the Budget. This goes a long way to show their commitment to the task. This should provide a lot of convenience to all travelers,” said Mayank Goyal, Founder and CEO, moneyHOP – India’s first cross border neo bank.

“One of the reasons why UPI has gained immense popularity in India and abroad is due to its simplicity of usage. UPI integration for inbound travelers sets India up with the infrastructure that can be leveraged to unlock value globally providing convenience to end consumers all across the world. India’s vast experience of successful adoption of UPI and building the infrastructure for it gives it a mover’s advantage in the global markets that can borrow a working, integrable, model to adopt,” he added.

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