KUALA LUMPUR: Financial safeguards will be in place when India’s Unified Payments Interface (UPI) system is introduced in Malaysia, says P. Kumaran.<\/p>\n
India’s External Affairs Ministry Secretary (East) said the planned safeguards will be directly built into the system to ensure UPI is not potentially used and abused by unintended parties.<\/p>\n
\u201cThe UPI\u2019s introduction is mainly to help tourists who shop in the partner countries and make it easier for workers from both countries to send their remittances back to their home country.<\/p>\n
\u201cAs such, safeguards will be built into it to make sure that it is only meant to address people who actually need this.<\/p>\n
\u201cSo initially, the plan is to have some restrictions on the amounts that can be transferred,\u201d he said in a press briefing on Indian Prime Minister Narendra Modi\u2019s official two-day visit to Malaysia here on Sunday (Feb 8).<\/p>\n
He also explained that there was currently no timeline for the introduction of UPI to Malaysia due to various complicated technical steps that need to be completed first.<\/p>\n
\u201cWe will first have to bring multiple banks on board with UPI in both countries, followed by some kind of software alignment on both sides.<\/p>\n
\u201cA number of point-of-sale machines will also need to be developed for UPI alongside establishing collaboration with merchants in both countries so that tourists and other visitors can take advantage of UPI,\u201d he added.<\/p>\n
This comes after Modi announced that India\u2019s UPI system would enter the Malaysian market as Malaysia and India seek to deepen their longstanding economic ties during a reception on Saturday (Feb 7).<\/p>\n
Regulated by the Reserve Bank of India (RBI), UPI is a real-time digital payments system that enables instant peer-to-peer and person-to-merchant transactions directly by linking user bank accounts to the UPI application on their phone.<\/p>\n
It does this by allowing payments to be made to other user-created Virtual Payment Address (VPA), phone number or QR code without the need to share any bank account details.<\/p>\n
It is developed and operated by the National Payments Corporation of India (NPCI), the whole payment process is also secured through two-factor authentication.<\/p>\n
As of 2025, UPI stands as the largest retail fast-payment system globally, handling over 640 million transactions daily, accounting for nearly half of global real-time digital payment transactions while also outperforming other traditional platforms like Visa in volume.<\/p>\n
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