India to link UPI with Indonesia’s digital payments network

NEW DELHI: Crossing borders may soon be as easy as scanning a QR code. India will integrate its Unified Payments Interface (UPI) with Indonesia’s digital payments ecosystem, a move aimed at making cross-border transactions simpler for travellers, businesses and professionals while further expanding the global footprint of India’s home-grown payments infrastructure.

Announcing the initiative during his address in Jakarta, Prime Minister Narendra Modi said the proposed linkage will enable users in both countries to make retail digital payments using their domestic payment applications, reducing reliance on cash and international cards for everyday purchases.

The integration is expected to make payments more seamless for tourists, merchants and businesses by allowing users to pay through familiar UPI-enabled apps while travelling or conducting business overseas. Policymakers also see the move as strengthening bilateral trade and reinforcing cooperation in digital public infrastructure.

The partnership forms part of India’s broader strategy to internationalise UPI, which has grown into one of the world’s largest real-time retail payments systems. By connecting with overseas payment networks, India aims to deepen economic ties while positioning its digital payments architecture as an exportable public digital infrastructure.

The announcement follows UPI’s recent expansion into Cambodia, where Indian travellers can now make payments by scanning the country’s KHQR code system at more than 4.5 million merchant outlets, including restaurants, retail stores and tourist destinations.

The Cambodia rollout was enabled through a partnership between NPCI International Payments Limited (NIPL) and ACLEDA Bank, marking the first phase of a cross-border QR payment linkage between the two countries. The arrangement allows Indian users to complete transactions in real time without using cash or foreign exchange cards.

UPI’s international push comes as the platform continues to scale rapidly in India. According to National Payments Corporation of India (NPCI) data, UPI is projected to process around 240 billion transactions in FY26, representing year-on-year growth of nearly 30 per cent. While slower than the 41 per cent growth recorded in FY25, the platform’s scale continues to expand, having processed 185 billion transactions in FY25 compared with 131 billion in FY24.

At the same time, NPCI is accelerating product innovation to maintain UPI’s competitive edge in online commerce. The organisation is promoting UPI Meta, also known internally as UPI Checkout, to make e-commerce payments quicker and more frictionless.

Industry executives say the move is partly driven by growing competition from tokenised credit cards, biometric authentication and one-click checkout systems, which have significantly reduced friction in card-based online payments. The anticipated launch of Apple Pay in India is also expected to intensify competition for affluent consumers, a segment that increasingly accounts for high-value digital transactions.

Against this backdrop, international partnerships such as the proposed Indonesia integration serve a dual purpose. While simplifying travel and trade, they also strengthen UPI’s position as a globally interoperable payments network, helping ensure India’s digital payments ecosystem remains competitive both at home and on the international stage.