The Central Bank of the Republic of Peru (BCRP) has announced plans to create a system similar to India’s Unified Payments Interface (UPI) in collaboration with the National Payments Corporation of India International Payments (NIPL). The Reserve Bank of India (RBI), a co-founder of the National Payments Corporation, worked together with the BCRP on this initiative.
This new system is aimed at promoting financial inclusion in Peru, especially for the large unbanked population, by taking inspiration from India’s UPI which allows for offline transactions. Additionally, it will improve interoperability between domestic and international payment systems, providing more payment options for the people of Peru.
Governor Julio Velarde of the BCRP expressed that the system will facilitate the entry of new participants into the Peruvian ecosystem while complementing the current payments industry. While no specific launch date has been announced yet, the system is expected to have a significant impact on the financial landscape in Peru.
The UPI system allows users to link multiple bank accounts in their mobile apps and utilize virtual payment addresses, phone numbers, and QR codes for payments round the clock. NIPL, established in 2020, has garnered support from countries like Sri Lanka, Mauritius, France, the United Arab Emirates, Singapore, Bhutan, and Nepal for the UPI system. In addition, NIPL is working with the Bank of Namibia to implement a UPI-like payment system following an agreement in May.
NIPL has established partnerships with Google Pay and financial institutions in the United States, Japan, China, and Singapore. Singapore was the first country to adopt the UPI system, partnering with PayNow in February 2023.
Peru has at least two stablecoins pegged to the Peruvian sol, and discussions have been ongoing since 2021 regarding the introduction of a central bank digital currency (CBDC). The BCRP has collaborated with monetary authorities from China, India, Singapore, and Hong Kong on the development of a CBDC in 2021, a year before India officially launched its retail CBDC pilot.
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