Real-time Cross-border Payments Set to Transform Trade: India and Indonesia Unite Their Fast Payment Systems


Pic Courtesy: etb2bimg

A mutual understanding has been established between India and Indonesia with the signing of a memorandum to interconnect their rapid payment systems, India’s Unified Payments Interface (UPI) and its Indonesian equivalent. This linkage will enable cross-border transactions through these two systems, which are notably well-received in their home countries.

This agreement was inked by the Reserve Bank of India and Bank Indonesia at the third G20 Finance Ministers and Central Bank Governors (FMCBG) meet in Gandhinagar, India. Indian Finance Minister Nirmala Sitharaman and Indonesian Finance Minister Sri Mulyani Indrawati were present as witnesses during the signing.

According to Sitharaman, the agreement will spur trade and investments between India and Indonesia. It is also anticipated to advance the application of local currencies for cross-border dealings.

The UPI is an immediate payment system that permits users to make instant transactions to businesses and individuals via their bank accounts. This system is the leading payment system in India, boasting over 500 million users.

The BI-Fast Payment System, launched in 2021, serves as the Indonesian equivalent to the UPI, providing real-time payment capabilities.

The integration of these two systems will make possible real-time cross-border transactions, trimming down costs and time associated with international payments. It is also set to simplify cross-country trade for businesses and individuals.

The pact between India and Indonesia is part of a wider initiative to encourage the use of domestic currencies in cross-border transactions to minimize dependence on the US dollar and foster financial stability.

This progressive step of India and Indonesia towards strengthening cross-border payment systems in the region holds immense potential to stimulate trade and investments, and to encourage the use of domestic currencies in cross-border dealings.

Editorial Team

Disclaimer: The views expressed in this feature article are of the author. This is not meant to be an advisory to purchase or invest in products, services or solutions of a particular type or, those promoted and sold by a particular company, their legal subsidiary in India or their channel partners. No warranty or any other liability is either expressed or implied.
Reproduction or Copying in part or whole is not permitted unless approved by author.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Latest Articles

Sign Up for CXO Digital Pulse Newsletters

Sign Up for CXO Digital Pulse Newsletters to Download the Research Report

Sign Up for CXO Digital Pulse Newsletters to Download the Coffee Table Book

Sign Up for CXO Digital Pulse Newsletters to Download the Vision 2023 Research Report

Download 8 Key Insights for Manufacturing for 2023 Report

Sign Up for CISO Handbook 2023

Download India’s Cybersecurity Outlook 2023 Report