Tuesday, June 25, 2024
HomeTechnologyPeru Adopts India’s UPI System To Boost Financial Inclusion

Peru Adopts India’s UPI System To Boost Financial Inclusion

The BCRP has entered into an agreement to develop a payments system in Peru similar to India’s Unified Payments Interface (UPI). This system aims to enhance financial inclusion among Peru’s largely unbanked population and improve interoperability within both domestic and international payment ecosystems.

The agreement has been announced, but no specific launch date for the new payment system has been provided. The system will be implemented in Peru, with the potential for broader application as seen in other countries that have adopted similar systems through collaboration with NIPL.

The planned payment system will allow users to link multiple bank accounts to a mobile app, enabling transactions via virtual payment addresses, phone numbers, and QR codes on a 24/7 basis. This system is designed to facilitate greater access, security, efficiency, and redundancy in digital payments. It also aims to introduce new digital payment use cases within the Peruvian financial landscape.

This initiative is part of a broader effort by the BCRP to leverage technology to bridge the financial inclusion gap in Peru. The country has a significant portion of the population that remains unbanked, and introducing a robust, accessible payment system could dramatically change how Peruvians engage with the financial system. The RBI’s experience with UPI, which has successfully served a similar role in India, provides a proven model that the BCRP hopes to replicate. Additionally, the collaboration with NIPL aligns with global trends towards increasing digital payments interoperability, as evidenced by UPI’s adoption in other countries and partnerships with major international payment platforms like Google Pay. The development of this system in Peru could also complement ongoing explorations into the introduction of a central bank digital currency (CBDC), marking a significant step in modernizing the country’s financial services.

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