𝐈𝐧𝐝𝐢𝐚 𝐚𝐧𝐝 𝐁𝐡𝐮𝐭𝐚𝐧 𝐋𝐚𝐮𝐧𝐜𝐡 𝐂𝐫𝐨𝐬𝐬-𝐁𝐨𝐫𝐝𝐞𝐫 𝐐𝐑 𝐂𝐨𝐝𝐞 𝐏𝐚𝐲𝐦𝐞𝐧𝐭 System

By Sonam Choki

The Royal Monetary Authority of Bhutan (RMA) and the National Payments Corporation of India rolled out the third phase of the project on the cross-border interoperable QR code payment linkage between Bhutan and India this week.

The project is in continuation to the announcement made during the launch of RuPay in 2019 by the Prime Minister of India, Shri Narendra Modi, and the Prime Minister of Bhutan, Dr. Lotay Tshering.

The project, initiated on 20th March 2021, was digitally launched by Nirmala Sitharaman, the Finance Minister of India, and Namgay Tshering, the Finance Minister of Bhutan on 13th July this week.

The Indian embassy in Thimphu said this linkage represents another key milestone between Bhutan and India in the digital payment space to connect and provide payment services using innovative financial technologies, to deepen the financial integration of the two countries, and to enhance the capital flow through affordable provisioning of payment infrastructure both within and outside of each of the two countries.

It said, with the linkage, Indian citizens will henceforth be able to make instant and secure QR code payments using their smart mobile phones to pay for goods and services at any retail and major service provider outlets in Bhutan, thereby making payments much more accessible.

A total of 182 banks in India provide QR code payment services through their respective mobile applications, accounting up to 170.76 million users on Android and 3.61 million users on iOS.

The general acceptability of Bhutan QR code payments, as a safe alternative to cash or other means of payments, have surged during the Covid-19 pandemic, with QR code payments increasing 300 percent since July 2020 and QR code adoption has risen over 90 percent. 

It is stated that a total of 23,792 merchants in Bhutan accept QR code payments and 356,157 users have registered for QR code payments, indicative of peoples’ growing preference for cashless transactions.

“The benefits of the QR code payment thus far have been numerous, including that of consumer convenience and reductions of costs for both customers and banks,” it said.

The cross-border QR code project is a key component in the Royal Monetary Authority’s efforts to improve the quality and coverage of the regional and international payments by harnessing financial technologies, while safeguarding the basic tenets of safety and security in the financial sector.

Terming BHIM-UPI as one of the achievements of India in terms of fintech, Indian Finance Minister Nirmala Sitharaman said it is a very successful experiment that India has undertaken.

She said the launch of BHIM-UPI QR-based payments in Bhutan will further strengthen the cooperation between the two neighbouring nations.

The service was formally launched by the Finance Minister at a virtual ceremony in the presence of Minister of State for Finance Bhagwat K Karad, Financial Services Secretary Debasish Panda and Joint Secretary Madnesh Kumar Mishra.

Finance Minister of Bhutan, Lyonpo Namgay Tshering, Governor of Royal Monetary Authority (RMA) of Bhutan, Dasho Penjore, Ambassador of Bhutan to India General V Namgyel, Ambassador of India to Bhutan, Ruchira Kamboj were also present.

Appreciating the efforts of RMA, and National Payments Corporation of India (NPCI) in linking BHIM-UPI app and RuPay Card with the Bhutanese payments system, Sitharaman said, “I think this stands out as a very good example and it is only going to strengthen further and further cooperation between the two countries.”

The launch is expected to benefit more than 2,00,000 tourists from India who travel to Bhutan each year.

With this launch, Bhutan will become the first country to adopt Unified Payment Interface (UPI) standards for its QR deployment.

Bhutan will also become the only country to issue and accept RuPay cards as well as accept BHIM-UPI.

It is to be noted that India launched indigenously-developed RuPay Card in Bhutan in 2019 and the phase two was launched in November 2020.

Following that visit, India and Bhutan have already enabled inter-operability in acceptance of RuPay cards in each other’s countries in two phases – acceptance of RuPay cards issued in India at Bhutan-based terminals in the first phase, and vice versa in the second phase, the Finance Ministry said in a statement.

Asserting that the inherent strength of BHIM-UPI is something which India feels proud of, Sitharaman said, it processed 22 billion financial transactions worth Rs 41 lakh crore in 2020-21 when the world was under the grip of pandemic.

During the pandemic, UPI stood out as an effective instrument of payment as people were able to buy essentials by making digital payments, she added.

Terming BHIM-UPI as one of the achievements of India in terms of fintech, she said, it is a very successful experiment that India has undertaken.

The launch of BHIM UPI in Bhutan will add a new milestone in financial integration between the two economies and the collaboration will enable acceptance of UPI-BHIM app in Bhutan.

RMA will ensure that the participating NPCI mobile application through UPI QR transactions is accepted at all RMA acquired merchants in Bhutan.

UPI is an instant real-time payments system, allowing users to transfer money on a real-time basis, across multiple bank accounts without revealing details of one’s bank account to the other party.

This strategic partnership with Bhutan in the area of digital payments will not only enhance the ease of transacting for Indian travellers to Bhutan but will also add value to lives of customers in Bhutan.

As a part of the launch, Sitharaman also made a live transaction using BHIM-UPI to purchase an organic product from a Bhutanese OGOP (One Gewog One Product) outlet, which sells fresh farm produce made organically by local communities in Bhutan.

Lyonpo Namgay Tshering, thanked and appreciated the Government of India for the launch of BHIM-UPI services in Bhutan.

As a part of the launch, Nirmala Sitharaman also made a live transaction using BHIM-UPI to purchase an organic product from a Bhutanese OGOP outlet, which sells fresh farm produce made organically by local communities in Bhutan.

Bhutan is the first country to adopt UPI standards for its QR deployment, and the first country in our immediate neighbourhood to accept mobile-based payments through the BHIM App.