Peru's Central Bank Collaborates with NIPI to Establish India's UPI-like Payment System
Summary:
The Central Bank of Peru (BCRP) collaborates with National Payments Corporation of India International Payments (NIPI) to develop a payment system akin to India's Unified Payments Interface (UPI), aiming to foster financial inclusion. The generic UPI platform facilitates payments via virtual addresses or QR codes, thereby improving accessibility and security in transactions. Currently endorsed by countries including Sri Lanka, Mauritius, France, and Singapore, the UPI system also plans to extend to Namibia. Peru, which has deliberated the launch of a Central Bank Digital Currency (CBDC) since 2021, has two stablecoins pegged to its national currency, the sol.
The Central Bank of Peru (BCRP) is set to develop a payment system similar to India's Unified Payments Interface (UPI), following an agreement with the National Payments Corporation of India International Payments (NIPL). This partnership also involves the Reserve Bank of India, a co-founder of the National Payments Corporation. This setup aims to increase financial inclusivity in Peru, a country with a significant number of people without access to banking services, by facilitating offline transactions akin to the UPI. It also intends to improve synchronization between international and domestic payment systems.
The Governor of BCRP, Julio Velarde, highlights that the new system invites new players into the Peruvian payment industry, adding value to the current system. However, the date of launch remains to be confirmed.
The UPI model allows users to sync multiple bank accounts to their mobile applications and make payments using virtual payment addresses, QR codes and even their phone numbers, around the clock. BCRP stated their aim is "to encourage greater accessibility, security, reliability, and efficiency, plus ease the incorporation of new digital payment use-cases."
NIPL, established in 2020, has the backing of several countries for its UPI system, including Sri Lanka, Mauritius, France, UAE, Singapore, Bhutan, and Nepal. They are also working with the Bank of Namibia to implement a similar payment system there under a deal signed in May.
Partnerships exist between Google Pay and financial establishments in the US, Japan, China, and Singapore and the NIPL, with Singapore being the first country the UPI extended to through a partnership with PayNow in February 2023. In Peru, there are at least two stablecoins tied to the Peruvian sol. The nation has been exploring the possibility of launching a central bank digital currency (CBDC) since 2021. The BCRP collaborated with monetary authorities in China, India, Singapore, and Hong Kong on the CBDC development in 2021, a year before India officially initiated its retail CBDC pilot.
Published At
6/7/2024 7:57:02 PM
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