NPCI subsidiary partners with FSS to accelerate UPI’s global expansion plans

Chennai based financial services company Financial Software and Systems (FSS) has partnered with NPCI International Payments (NIPL) to expand the presence of digital payments platform Unified Payments Interface (UPI) in international markets.

NIPL is a subsidiary of the National Payments Corporation of India (NPCI), the umbrella organisation for all retail payments and settlement systems in India.

UPI is an instant payment system developed by government-owned and central bank-regulated entity NPCI. Built on the Immediate Payment Service (IMPS) infrastructure, UPI allows instant transfer of money between any two bank accounts.

“The FSS and NIPL collaboration brings together complementary capabilities to deliver a compelling end-to-end proposition to activate real-time payments at speed and minimal risk,” a statement said.

Several governments and regulators globally are keen on replicating NPCI’s success in India, where it processes close to three billion transactions a month on the UPI network, the statement said.

Under the partnership, NIPL will offer its real time payments processing platform and technical acumen to scheme operators, while FSS will extend integration and support services.

“At NIPL, we are dedicated to take our exemplary robust payments system to global markets and equip willing nations with resources and technological proficiency. FSS is a demonstrated leader in payments and its domain expertise combined with a strong international presence makes them a valuable partner to offer a market-leading, real-time payments system to millions of people across the globe," Ritesh Shukla, CEO of NIPL, said.

The FSS-UPI gateway currently supports bank PSPs in India to connect to the UPI central payments infrastructure and brings a range of overlay services -- QR payments, split payments, request to pay, corporate payments, autoPay – as well as reconciliation and authentication solutions.

The company offers an integrated portfolio of software products, hosted payment services and software solutions. Its products suite powers retail delivery channels including ATM, PoS, internet and mobile as well as back-end functions including cards management, reconciliation, settlement, merchant management and device monitoring.

“Worldwide, the drive towards real-time payments is gaining momentum, with many countries embarking on modernisation of payments infrastructure to broad-base the benefits of the digital economy. We are excited to partner with NIPL to bring a proven, best-in-class real-time payment offering that will speed innovation and adoption of digital commerce and have a wide-ranging economic impact,” K Srinivasan, COO, PayTech, FSS, said.

Since its inception in 2016, UPI has seen significant growth in transactions, app users and QR codes deployments, at CAGR of 285%. In 2020, UPI processed transactions worth $457 billion, equivalent to 15% of the Indian GDP.

In March, India carried out payments across nearly 2.79 billion transactions totaling over Rs 5.09 trillion using UPI, as per NPCI data.   

For a while, India’s fintech landscape has been trying to break several monopolies in the UPI ecosystem of payments, whether in NPCI’s control of the underlying technology, or the volume of transactions.  

Late last month, NPCI released a nine-page standard operating procedure (SOP) to monitor the 30% market share cap for third party application providers (TPAP) such as Google Pay, Paytm, and PhonePe.