The newly appointed governor of the Reserve Bank of India (RBI), Sanjay Malhotra, announced that the central bank will expand the reach of United Payments Interface (UPI) bilaterally by linking UPI with fast payment systems of other countries and facilitating efficient cross-border payments.

Simultaneously, the RBI will explore linking payment systems other than UPI to improve cross-border payment effectiveness and foster innovation in payment systems through “soft-touch regulations” within established boundaries. 

“While in domestic payments, the success of UPI has propelled India to a leadership position with a share of 48.5 per cent in global real-time payments by volume, we will endeavour to make cross-border payments more efficient,” Malhotra said at the inauguration of Digital Payments Awareness Week 2025.

“This assumes priority as India is the largest receiver of personal remittances globally. As per a World Bank report, it has been estimated that in 2024, India received remittances totalling approximately $130 billion. We need to address the challenges of high cost, slow speed, and insufficient access and transparency in cross border payments,” Malhotra highlighted.

The central bank will continue its engagement in a multilateral project called Project Nexus, to enable instant cross-border retail payments, Malhotra informed. Nexus, conceptualized by the Innovation Hub of the Bank for International Settlements (BIS), aims to connect the fast payment systems of four Southeast Asian countries—Malaysia, Philippines, Singapore, and Thailand—and India, who would be the founding members and first mover countries of this platform.

“Apart from the RBI, the government and other important stakeholders such as the banks and payment system operators have also taken a number of initiatives to encourage the adoption of digital payments. While these efforts have produced results, as visible in the huge growth of digital payments, there is still a lot more to be done,” Malhotra added.

Malhotra, who gave up his role as revenue secretary to the Finance Ministry, is the 26th Governor of RBI for a three-year term starting December 2024. Last month, he reduced India’s benchmark rate for the first time in nearly five years, with economists anticipating further rate cuts in April. The central bank expects the country’s growth for the fiscal year starting on April 1 to touch 6.7%, at a time when the United States-China trade war is intensifying, tariffs are imposed on trading partners, and the global economy seems to be approaching a critical juncture similar to the 2008 Global Financial Crisis.

Digital payment for economic growth

“Payments through digital modes support economic growth. They also deepen financial inclusion by overcoming barriers like high transaction costs and geographical limitations. In effect, digital payments are not just convenient but are also a powerful tool for economic empowerment and growth,” Malhotra pointed out.

He explained that payments are the “lifeblood of commerce,” enabling the flow of goods and services in an economy. 

“They connect people, empower individuals and businesses, and drive economic growth. Quick, secure and reliable payments at affordable prices are the bedrock for a vibrant economy,” he noted.