• India is enhancing cross-border payments by partnering with ASEAN countries and integrating instant payment systems like UPI and PayNow.
• The RBI is advancing its CBDC pilot, focusing on its impact while prioritizing collaboration for unified international payment standards.

India is making strides in enhancing cross-border payment systems through partnerships with multiple countries, according to a Bloomberg report. Speaking at a conference in Cebu, Philippines, Reserve Bank of India (RBI) Deputy Governor T Rabi Sankar outlined the country’s efforts to establish seamless payment mechanisms with international partners.

India currently has operational payment arrangements with Sri Lanka, Bhutan, and Nepal and is working to expand these agreements to include the UAE and other neighboring nations. In addition, the RBI is collaborating with central banks in the ASEAN region to develop an integrated platform for instant cross-border payments, marking a significant step toward regional financial integration.

As one of the early adopters of a pilot central bank digital currency (CBDC), India is also assessing its broader implications on the banking system and monetary policy. Sankar stressed that the public rollout of the digital rupee would depend on thorough evaluations of its potential impact, emphasizing a cautious approach.

“We are in no hurry to roll it out immediately,” said Sankar

RBI Governor Shaktikanta Das has expressed willingness to provide technical support to countries interested in setting unified international standards for cross-border payment systems. This aligns with India’s efforts to promote interoperability and efficiency in global financial transactions.

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Meanwhile, the Bank for International Settlements (BIS) has announced plans to link instant payment systems from five countries—India, Malaysia, Thailand, Singapore, and the Philippines—by 2026 under its Project Nexus initiative. The goal is to integrate systems like India’s Unified Payment Interface (UPI) and Singapore’s PayNow, creating a unified platform for instant retail payments.

India and its four regional partners will serve as founding members of this initiative, with Indonesia participating as a special observer. These developments highlight India’s commitment to advancing cross-border payment systems and its cautious yet progressive approach toward CBDC implementation.