US private banks may think about integrating with India’s digital payment system as UPI gets traction abroad, as per Federal Reserve Governor Christopher Waller.
Waller was speaking at the ‘Global Fintech Fest’ that is being held in Mumbai over three days.
Read on to find out all the details!
US Private Banks To Integrate Indian Digital Payment System, UPI
Integration of cross-border payments is one of the G20 roadmap’s main priorities.
Waller pointed out that while there aren’t enough bank connections in the US to support a full UPI service, some private banks would be a good fit for integration.
Effective integration requires the establishment of a compelling value proposition.
Waller praised the joint public-private effort of India’s digital payments system for improving financial inclusion, “The technology-driven payments revolution in India has been enabled by a public-private partnership to build the ‘technology stack’ of digital platforms that has broadened financial inclusion and done so at low costs.”
This shift driven by technology has reduced expenses while improving financial access.
The demand for more economical and effective cross-border payments for firms and consumers is addressed in the G20 plan.
Banks To be Able to Handle Payments Between Nations
Through technical linkages between their home systems, banks may be able to handle payments between nations through cross-border payment interlinking.
The US Federal Reserve will keep collaborating with global forums to improve the effectiveness of cross-border payments and tackle important system interlinking concerns.
Waller expects the private sector to make strides in technological capabilities, legal frameworks, and creative solutions.
He states, “I expect the technical capabilities, legal infrastructure, and use cases for faster cross-border payments will evolve, and I look forward to following the private-sector innovation that will emerge from stakeholders represented at this event.”
Governor of the Reserve Bank of India Shaktikanta Das said that other countries might use India’s UPI as a plug-and-play solution, thereby providing a quicker and less expensive option for international remittances.
The UPI system is thought to be a viable substitute for the current cross-border remittance systems.
We all know that UPI is still expanding quickly, with almost 6 million new users every month. International partnerships have resulted from UPI’s success in India; NPCI hopes to process one billion UPI transactions daily in the future.
