National Payments Corporation of India after success in domestic market India According to a Bloomberg report quoting Ritesh Shukla, CEO, NPCI International Payments, (NPCI) is planning to take the Unified Payments Interface (UPI) to overseas markets. It will be a domestic alternative to SWIFT, a Belgium-based cross-border payment system operator.
“We have largely displaced cash in India and are now trying to replicate the success in the cross-border corridors… We will build acceptance for our equipment,” Shukla said as per the report. It also said that the remittance market, where it costs an average of $13 to send $200 across borders, is ripe for disruption.
Indians abroad remitted $87 billion in 2021, largest inflow to any country World Bank.
Under RBI’s Liberalized Remittance Scheme, all resident individuals including minors are allowed to freely remit up to USD 2,50,000 per financial year (April-March) for any permissible current or capital account transaction or a combination of both Is. In addition, resident individuals can avail foreign exchange facility for specific purposes only within the limit of USD 2,50,000.
The scheme was launched on 4 February 2004 with a limit of USD 25,000. The LRS limit has been revised in phases to suit the prevailing macro and microeconomic conditions. In case the remitter is a minor, the LRS declaration should be countersigned by the minor’s natural guardian. This scheme is not available for Corporates, Partnership Firms, HUFs, Trusts etc.
The World Bank in its latest report said that during 2021, India received $87 billion in remittances, and the US was the largest source, accounting for over 20 per cent.
“Flows into India (the world’s largest recipient of remittances) are expected to reach $87 billion, with the severity of the COVID-19 caseload and deaths (above the global average) playing a major role during the second quarter, with an increase of 4.6 per cent. The World Bank report states that the country has been able to attract philanthropic inflows (including the purchase of oxygen tanks).
The report said that India is followed by China, Mexico, Philippines and Egypt. In India, remittances are projected to increase by three per cent to $89.6 billion in 2022, reflecting a decline in the total expatriate stock, as a large proportion of returnees from Arab countries await return, it said.
The bank said remittances to low- and middle-income countries are projected to grow 7.3 percent to reach $589 billion in 2021. This return to growth is stronger than earlier estimates and follows a resiliency of flows into 2020, when remittances only increased despite a severe global slowdown due to COVID-19, according to projections from the World Bank’s Migration and Development Brief. declined by 1.7 percent.
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