India’s neighbors adopt its digital payment system  

The leaders of India, Mauritius, and Sri Lanka have launched New Delhi’s Unified Payment Interface (UPI) system. The move allows Indian tourists to pay for products with the app while visiting the two island nations, and comes as New Delhi seeks to boost economic cooperation with its neighbors.   

A virtual ceremony launching the UPI service involved Indian Prime Minister Narendra Modi, his Mauritian counterpart Pravind Jugnauth, and Sri Lankan President Ranil Wickremesinghe. India has already introduced its RuPay card in Mauritius, one of the top tourist destinations in the region, an official statement noted.  

In his address, Modi praised the move as a significant milestone for ties with Lanka and Mauritius, saying their rich historical connections are evolving into modern digital connectivity. The new collaboration will facilitate “cross-border connections” as well as international payments, the Indian leader remarked. The smallest vendors in India’s remotest villages are already making “speedy” digital payments, Modi stated, adding that the country saw over 100 billion transactions worth $24 billion in 2023.  

Mauritian Prime Minister Jugnauth said the RuPay card will be co-branded with Mauritius Central Automated Switch (MauCAS), a digital facility fully owned and operated by the Bank of Mauritius, and will be designated as a domestic card in the island nation. Improving access to digital services was one of the key commitments during India’s G20 presidency, he added.   

The development comes after the Eiffel Tower in Paris became the first merchant to offer UPI payments in the country, shortly after French President Emmanuel Macron visited India. The service will soon be extended to other merchants in the tourism and retail space across Europe. 

The UK, UAE, Bhutan, Oman, and several Southeast Asian nations already accept payments through the Indian interface, which is regulated by the country’s central bank. It allows users to transfer funds instantly using a mobile device through a set of payment applications such as the India-developed Paytm. 

Creating new channels of engagement with its neighbors is seen as crucial for New Delhi, which is concerned about China’s growing influence in the region. In his address on Monday, Modi hinted that launching cross-border UPI services is part of India’s ‘Neighborhood First’ policy in the Indian Ocean Region (IOR). “Our maritime vision is SAGAR – meaning security and growth for all in the region. Our mission is to ensure peace, security, and development,” Modi underlined. 

The prime minister’s remarks come against the backdrop of growing tensions with another Indian neighbor, the Maldives, which is fostering closer ties with Beijing. Last month, the island nation asked New Delhi to remove around 80 military personnel deployed to operate and maintain two helicopters and an aircraft used for medical evacuations and humanitarian missions.

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