Using UPI Outside India — First hand Experience
I have been a early adaptor of various fintech platforms and apps for the sheer simplicity they provide. I used PayTm wallets regularly even before demonetization etc. As a tech enthusiast and a common man, UPI is a big boon. It avoided need to withdraw and use cash and avoids various hassles associated with it. There are many more articles, case studies on the impact and benefits of UPI to both consumers, retailers, banking eco system etc.
From 2023, UPI has expanded to various countries outside India. At the moment of writing, it is accepted in Franch, Singapore, Thailand, Vietnam, Philippines, UAE and the latest addition being Mauritius and Srilanka. I had the opportunity to try UPI twice outside of India. In Singapore in August 2023 and in Thailand on February 2024. In both occasions, my aim was to use it for retail payments. I did not get a chance to remit money from foreign countries to India.
Activating UPI International Payments
Before attempting payments, make sure you enable the international payments in your UPI app. In PhonePe and PayTm it can be done under the profile section, by clicking on your profile section and enabling it under Payments sub section.
UPI Experience in Thailand
Thailand is a interesting nation. It has the infrastructure of Singapore, but a mindset of India of 2014’s while coming to fintech and digital adoption. While digital options are available, people still prefer cash.
In Thailand my visit (happened in February 2024)was restricted only to Bangkok. I had a chance to spend money in starbucks, small pizzerias and taxis. While the shops had QR code, there is no standardised QR. A few had Alipay QR, in some of the swiping machines, shop keeper need to select payment provider in PoS machine before showing QR. Taxi person had a Thai QR, but not sure if it is not standardized like UPI.
For Thailand, UPI has agreement with LinqPay. In the pizzeria PoS machine, shop keeper was not able to generate QR of LinqPay from PoS. The taxi driver was able to easily show his QR from a mobile app, the scanning from PhonePe did not work (Even after enabling it).It could not recognize the receiver.
Even in other local markets, the shop keeper had QR provided by banks or Alipay. Compatibility with UPI was never highlighted.
UPI Experience In Singapore
In Singapore, i had a chance only to pay only shops in high end malls and in airport. Most of the shops there accepted Credit cards. While most of them had QR code based payment, they were using Alipay, which is not a partner for UPI. PayNow is the partner for UPI in Singapore.
Effectively I was not able to use UPI in both the countries.
Why UPI did not find acceptance with foreign merchants
1. Lack of Gateway agnostic QR:
In both the countries, the intermediate gateways or payment provider manage the QR, similar to the wallet of Fintech apps in India. Due to the lack on interoperability, the failure/non compatibility tend to increase. After failing in 2 or 3 places, people tend to give up or forget the UPI payment option.
2. Lack of awarenes among merchants:
Merchants are not aware of this payment option or how to make it work along with their existing payment enablers.
3. Lack of awareness among travellers:
Only time when people know that UPI can work outside of India is when a new country is added to the ecosystem. Even lot of young, educated and tech savvy people are not aware of this payment option or that UPI will work on the specific country they are visiting.
What can be done to Increase adoption
1. Increase awareness among travellers:
Improve awareness among indian travellers travelling about this option. It could be via advertisement in travel portals, hoardings in airport waiting areas in India (before departure),in the arrival area of supported countries, notification on the apps which support UPI payment, banks notification to customers etc.
2. Increase awareness among merchants:
Improve the awareness among the merchants in supported countries on how to accept payment via UPI. Highlight them the benefits (instant settlements against T+1 or T+2 against cards), better customer satisfaction.
3. Improve Interoperability:
Perhaps this will be the toughest. Work with regulators in other countries on how to remove the dependency of payment gateways. UPI can partner with more than one payment providers in one country or work with regulator to have payment vendor agnostic QR code which can be used with UPI. This will enable confidence amongst travellers to use without doubt of success % and will save time.