In Payments, Like Geopolitics, India Seeks a Third Way
The country sees its Unified Payments Interface as an alternative for the emerging world, one where the state has a say but innovation and profits are encouraged.
Companies face stiff competition.
Photographer: Dhiraj Singh/BloombergLast week, the Singaporean and Indian central banks unveiled a new system for cross-border cash transfers that, in New Delhi at least, was celebrated as something much more: the first step toward establishing an entirely new global payments system geared to the needs of the developing world. India’s Unified Payments Interface, or UPI, tied up with PayNow — run by a consortium of Singaporean banks — to provide what Singaporean Prime Minister Lee Hsien Loong described as “cross-border, real-time system linkage” with “cloud-based infrastructure.”
Indian policy makers believe that the UPI and allied elements of what it calls “digital public infrastructure” are one of their biggest recent innovations. The UPI serves as a platform that banks, non-banking financial corporations, and fintech apps can all use on an equal footing. While the Reserve Bank of India essentially runs it alongside a consortium of banks, the state has a big say in how it operates.