Maldives welcomes UPI: a new era of digital payments begins

In an exciting development for residents and tourists alike, the Maldives has officially adopted India’s Unified Payments Interface (UPI), marking a significant step towards the digitalization of its economy. The move comes after the signing of a memorandum of understanding between India and the Maldives, with the aim of strengthening financial inclusion and streamlining payment processes across the island nation. With the integration of UPI, Maldives is set to join a growing list of countries leveraging this secure and efficient payment system, bringing both economic benefits and strengthened bilateral relations with India.

Why UPI in Maldives?

For a country like the Maldives, where tourism is the lifeblood of the economy, the introduction of UPI is a game changer. Indian tourists, who make up a significant portion of visitors to the Maldives, will now be able to make payments seamlessly using UPI apps from their home countries. No more hassle with currency exchange or international transaction fees – just a quick scan and payment, whether it’s for a diving trip or a coconut on the beach. This convenience is expected to increase tourism revenue and improve the overall tourist experience.

But the benefits go beyond simple tourism. UPI integration is also expected to revolutionize cross-border transactions and drive greater financial inclusion among Maldivian residents, particularly those in remote areas who may not have easy access to traditional banking services. The move towards a cashless economy aligns with President Mohamed Muizzu’s vision to modernize the country’s financial infrastructure and expand digital services.

Reactions and global context

The introduction of UPI in the Maldives has generated excitement from financial experts and the general public. Many see it as a step toward creating a more inclusive financial system, while others are excited about the ease of transactions. “This will make payments easier, especially for tourists like us,” commented an Indian tourist during a visit to the Maldives, highlighting the practical impact.

On the global stage, India is actively promoting UPI as part of its digital diplomacy. UPI’s global presence is expanding rapidly, with several countries already involved. As of 2024, UPI has been used in Singapore, the United Arab Emirates, France, Bhutan, Nepal and Mauritius, and other countries such as Japan, Australia and the United Kingdom are considering its adoption. Each of these countries has seen transformative effects of UPI adoption, from reduced transaction costs to increased affordability.

Countries using UPI

The Maldives now joins an impressive list of countries that have integrated UPI technology into their payment systems. Here’s a quick look at some countries that currently use UPI:

1. Singapore: A major platform for Indian expats, UPI allows cross-border payments and remittances here.
2. United Arab Emirates (UAE): UPI is widely accepted by merchants, simplifying transactions for tourists and residents of India.
3. France: You can now pay for your Eiffel Tower tickets with UPI!
4. Bhutan: An early adopter of UPI, simplifying payments for Indian visitors.
5. Nepal: The first country outside of India to fully deploy UPI for its domestic payment systems.
6. Mauritius: A growing user of UPI to foster better trade and tourism with India.

A new digital frontier

Maldives’ adoption of UPI demonstrates its commitment to embracing the future of digital finance. By improving financial inclusion, simplifying transactions for tourists and deepening ties with India, the island nation is on the fast track to a more connected and digital economy. It’s a win-win situation for everyone involved: residents benefit from better access to banking services, tourists benefit from hassle-free payments, and businesses exploit new opportunities.