Maldives to have access to India’s UPI services, signs agreement
The Maldives has taken a significant step towards enhancing its financial infrastructure by signing an implementation agreement with India’s National Payments Corporation of India (NPCI) to access Unified Payments Interface (UPI) services. The agreement was signed on Friday during Prime Minister Narendra Modi’s ongoing visit to the island nation. This development is expected to boost trade between the two countries by making business payments faster and more efficient.
UPI is a real-time payment system developed by NPCI that allows users to make instant transactions between two bank accounts using a unique UPI ID. The service has been a game-changer in the Indian financial landscape, allowing users to make payments with just a few taps on their smartphones. The Maldives, with its growing economy and increasing trade with India, has recognized the potential benefits of UPI and has decided to adopt the system.
The agreement was signed by Rakesh Bhuhari, the CEO of NPCI, and Ahmed Mohamed, the Minister of Finance, Maldives. The agreement outlines the terms and conditions for the implementation of UPI services in the Maldives, including the technical and operational requirements. NPCI will provide technical assistance and support to the Maldives to ensure a smooth rollout of the service.
The implementation of UPI services in the Maldives is expected to have a significant impact on the country’s trade and commerce. It will enable businesses to make and receive payments quickly and securely, reducing the time and cost associated with traditional payment methods. This will be particularly beneficial for small and medium-sized enterprises (SMEs), which often struggle with cash flow management and payment processing.
The Maldives has been a strategic partner for India in the Indian Ocean region, and this agreement is seen as a further strengthening of the bilateral relationship. The UPI service will also facilitate remittances from Maldivian workers employed in India, which is a significant source of foreign exchange for the island nation.
In addition to the UPI agreement, India has also extended a line of credit worth $565 million to the Maldives. This credit line will be used to finance infrastructure development projects in the country, including the development of roads, bridges, and other critical infrastructure. The credit line is a testament to India’s commitment to supporting the economic development of the Maldives and strengthening their bilateral relationship.
The Maldives has been undergoing significant economic reforms in recent years, aimed at diversifying its economy and reducing its dependence on tourism. The country has been working to develop its financial sector, including the establishment of a stock exchange and the introduction of electronic payment systems. The introduction of UPI services will be a significant milestone in this process, enabling the country to access a wider range of payment options and reducing the cost of transactions.
The agreement between NPCI and the Maldives is a result of a Memorandum of Understanding (MoU) signed between the two countries in 2019. The MoU outlined a framework for cooperation in areas such as finance, trade, and technology. The UPI agreement is a key deliverable under the MoU and is seen as a major step forward in strengthening the bilateral relationship.
In conclusion, the signing of the UPI agreement between NPCI and the Maldives is a significant development that will have a positive impact on the country’s trade and commerce. The introduction of UPI services will enable businesses to make and receive payments quickly and securely, reducing the time and cost associated with traditional payment methods. The agreement is a testament to the strong bilateral relationship between India and the Maldives and will further strengthen their partnership in the Indian Ocean region.
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