Indian Prime Minister Narendra Modi will promote a homegrown Indian payments scheme during his third official visit to the UAE, this weekend.
During his two-day trip, Mr Modi will be awarded the Order of Zayed, the UAE’s highest civilian honour, but he will also launch the RuPay network at an event at Emirates Palace in Abu Dhabi on Saturday.
“The bilateral visit is anchored in the award but the Prime Minister is also keen on giving a big personal push to the RuPay card,” Navdeep Suri, India’s ambassador to the UAE, told The National.
RuPay is a credit or debit card like MasterCard or Visa that launched in India four years ago. Since then, 500 million people in India have subscribed to RuPay — a blend of the words rupee and payment.
“It’s become a deep part of our financial inclusion programme in India and now there is keen interest from the Prime Minister to get it global inclusion and acceptance,” said Mr Suri.
There is little knowledge about RuPay outside India, but its surge within the country has challenged the dominance of US giants such as Visa and MasterCard. This can be partially credited to Mr Modi, who encouraged use of the indigenous network by saying it serves the country — because the card’s transaction fee is spent towards building roads, schools and hospitals.
More than half of India’s one billion debit and credit cards now go through the RuPay system.
Mr Suri said Indian officials will work with UAE authorities, and companies that run point-of-sale machines, to ensure the card is accepted in the Emirates.
This will follow an agreement between payments networks in both countries that will be signed during Mr Modi’s visit.
By connecting the networks, Indian tourists will be able to use the card when visiting the UAE.
“There are 3 million Indian tourists who come to Dubai alone and they should be able to use the RuPay card whether at Dubai Mall or Abu Dhabi,” Mr Suri said.
There are also plans to lay the path for the card to be issued by UAE banks.
“The aim is to work in a time-bound fashion to have technology tie-ups between the two payments platforms that will enable Indian visitors to use it and UAE-based banks to issue the cards.
“Just as a Bank of Baroda or Emirates Nbd can issue a MasterCard, they should also be able to issue a RuPay card. The next step is to move to mobile based apps, QR payment systems with a unified payment interface.”
Using RuPay will save its users transaction charges including foreign exchange commissions. It also promises lower processing fees.
Non-Resident Indians said sustained promotion outside India was crucial to wide-scale acceptance when making international purchases or withdrawing cash outside the country.
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“I will be the first one to take it in Dubai. I think every Indian passport holder should get this card,” said Ram Buxani, chairman of the ITL Cosmos Group that covers consumer electronics, retail and financial services and board member of the Al Razouki International Exchange Company in Dubai.
“It is positive and will be well used. People invariably use a Visa or MasterCard when they travel, so why will they not use a card that is good for India? There needs to be a lot of information so more people hear of it.”
RuPay was devised to promote financial inclusion and encourage electronic payments in India to effect change in a society that relied heavily on cash-based transactions.
It tied in with the Bharatiya Janata Party’s ambitious programme Jan Dhan Yojana, People’s Wealth Plan, that aims to provide at least one bank account to every household. The programme launched when the Modi government took office in 2014.
Every Indian opening a bank account for the first time was offered a RuPay debit card under the programme. The scheme included an overdraft facility and a personal accident insurance as part of the federal government’s aim to bring every Indian into a social security net.
There has been immediate interest from Indian residents of the UAE.“Low income workers are price sensitive and lower fees will be attractive to them. Plus they will trust something coming from their own country,” said Abu Muadh, a software professional who works with blue-collar workers and launched a mobile application that delivers educational material.
“It will be a great idea to target domestic and low income workers in the UAE. But the main challenge is education because just giving them a debit card is not enough. They need to understand how to protect themselves from the perils online. It needs to be coupled with teaching them how to use it wisely, how they can save money and benefit from this.”
The RuPay network was developed by the National Payments Corporation of India, owned largely by state banks and backed by the Reserve Bank of India, the country’s central bank.
The growth of RuPay soared last year when the Modi government announced demonetisation to replace high-value bank notes and flush out untaxed wealth.
Mr Modi arrives in the UAE from Paris, France, on Friday night and will hold talks with Sheikh Mohamed bin Zayed, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the Armed Force.
He will receive the Order of Zayed to acknowledge his contribution to boosting closer bilateral ties between the two nations.
Mr Modi will also release a commemorative Gandhi stamp to mark the 150th birth anniversary of the non-violence leader before heading to Bahrain on Saturday.