The Reserve Bank of India (RBI) has proposed allowing foreign tourists to make merchant payments through the United Payments Interface (UPI) while in India. The system will enable users to link their bank accounts to related apps such as Paytm, PhonePe and Google Pay for merchant payments and fund transfers.

Announcing the Monetary Policy Committee (MPC) measures on Wednesday, February 8, RBI Governor Shaktikanta Das said: “Initially, tourists from G20 countries upon arrival at selected international airports will be allowed to use the facility.”

Das said UPI had become a ubiquitous payment tool in retail electronic payments in India. “A recent improvement has been made to provide UPI access to non-resident Indians with an international mobile number associated with their NRE/NRO account. It is now proposed to allow all travellers entering India to use UPI for merchant payments (P2M) when they’re in the country,” he said.

Das said that in the future, the facility would be activated at all other entry points in the country. Operating instructions will be released soon, he added.

Last month, the National Payments Corporation of India (NPCI) asked the UPI ecosystem to allow users of non-resident account types in some countries to use international mobile numbers for transactions such as non-resident external (NRE) and non-resident ordinary (NRO) accounts through UPI. It simply means that non-resident Indians (NRIs) can now pay with UPI without an Indian mobile number.

An NRE account is a bank account opened in India in the name of an NRI to deposit his foreign income, while an NRO account is a bank account opened in India in the name of an NRI to manage his/her income earned in India. These incomes include rent, dividends, pensions, interest, etc.

Meanwhile, the Reserve Bank of India raised its crucial benchmark policy rate by 25 basis points to 6.5%, citing sticky core inflation. This is the RBI’s sixth rate hike since May last year, bringing the total rate hike to 250 basis points.