With the launch of the Unified Payments Interface (UPI) in Cambodia, Indian tourists can now pay directly through mobile applications at over 4 million retail locations in the Southeast Asian country.
The action is another step in India's efforts to expand its domestic digital payments infrastructure internationally and facilitate travellers' international spending, reported Business Standard.
The National Payments Corporation of India's (NPCI) overseas division, NPCI Overseas Payments Limited (NIPL), and Cambodia's ACLEDA Bank Plc have partnered to provide the facility. The agreement links Cambodia's national QR payment ecosystem, known as KHQR, which functions under the Bakong digital payment system, with India's UPI network.
Travellers can pay instantaneously by scanning KHQR codes displayed by Cambodian merchants using participating UPI apps from Indian banks and payment service providers.
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The system functions similarly to a domestic UPI transaction. Travellers can make QR-code-based payments straight from their linked bank accounts rather than carrying a lot of cash or depending solely on foreign debit and credit cards.
The initial phase of the distribution is targeted at Indian users who travel to Cambodia. Reciprocal acceptance is anticipated in a later phase, enabling Cambodian users to utilise their KHQR-enabled apps at UPI merchant locations to make payments in India.
In a press release, the Reserve Bank of India stated, "The Reserve Bank of India (RBI) has been actively pursuing interlinking of UPI with fast payment systems of other jurisdictions to promote cross-border payments. These initiatives are aligned with the G20 Roadmap for enhancing cross-border payments, with a focus on cheaper, more efficient, more transparent, and more accessible payments.
One of the most frequent problems for Indians travelling abroad is still making cross-border payments. Travel expenses are frequently increased by international transaction fees, cash handling, card acceptance problems, and currency conversion costs.
By enabling real-time digital payments using a recognisable interface that Indian customers already use at home, the Cambodia deployment aims to address some of these issues.
RBI has been actively pursuing the interlinking of UPI with fast payment systems of other jurisdictions to promote cross-border payments. These initiatives are aligned with the G20 Roadmap for enhancing cross-border payments, with a focus on cheaper, more efficient, more transparent, and more accessible payments.
The Indian travellers will have less reliance on foreign cards for regular transactions. Increased convenience at eateries, tourist destinations, retail establishments, and nearby companies.
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Travellers can use participating UPI apps issued by Indian banks and payment service providers to scan KHQR codes displayed by merchants in Cambodia and pay instantly.
The system works much like a domestic UPI transaction. Instead of carrying large amounts of cash or relying entirely on international debit and credit cards, travellers can make QR-code-based payments directly from their linked bank accounts.
The rollout's first phase is focused on Indian users visiting Cambodia. A later phase is expected to introduce reciprocal acceptance, allowing Cambodian users to make payments in India using their KHQR-enabled applications at UPI merchant locations.
The program, which offers real-time payment confirmation, may be especially helpful for travellers on a tight budget who would rather retain their purchases directly connected to their bank accounts than use credit facilities overseas.
For Indian travellers visiting well-known locations like Phnom Penh, Siem Reap, and Sihanoukville, the scope of retailer acceptance greatly expands digital payment alternatives.
The list of nations where Indian tourists can use UPI to make merchant payments is expanding, and Cambodia is one of them.
The addition of Cambodia to the digital payments ecosystem in India is a significant step forward for UPI's worldwide expansion. Travellers now have another location where paying for a meal, a ride in a taxi, or a memento might be as easy as scanning a QR code and approving a transaction on a smartphone.
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