National Payments Corporation of India (NPCI) and banks in the US and India are in advanced stages of discussions to flesh out a real-time payment linkage between the US and India, said people aware of the developments. The plan seeks to build on the domestic payments body's inroads in setting up cross-country systems.
Within the ecosystem of the unified payments interface (UPI), the NPCI is working with Indian banks that have experience with the system as well as foreign banks to develop use-case models and testing pilots, the people cited above told ET.
«NPCI is working along with Indian banks and foreign banks to see how they can partner. In addition to talking directly to FedNow or their UPI equivalent on how to connect, they also need the large US banks to partner so that the use-case, testing, etc happens. The process is in advanced stages,» a person said.
Read more on economictimes.indiatimes.com
FedNow is a real-time payment service created by the US Federal Reserve, launched in July 2023. NPCI did not respond to an email query till press time. The current focus is on building connectivity which would make any proposed collaboration commercially viable, a second person said.
Given that the US does not yet have a nationwide system similar to what the NPCI has done with the UPI in India, the model would initially focus on small consumer payments, people said.
«It's real time, so it won't be huge, quantum-wise or value-wise. There would be caps. They want to start slow, with small payments. As of now, the US does not have a successful UPI