At the India-SICA (Sistema de la Integración Centroamericana, or Central American Integration System) Foreign Ministers' Meeting in New York, External Affairs Minister (EAM) S. Jaishankar extended an invitation to SICA member states to adopt India's Unified Payments Interface (UPI) system. He emphasized that India is ready to collaborate with SICA partners to adapt UPI for their economies, with the potential to enhance financial inclusion and payment system robustness in the region.
SICA is the institutional framework for regional integration in Central America. It was established in 1991 and includes Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, and Panama. Belize and the Dominican Republic later joined as full members. Mexico, Chile, and Brazil are regional observers, while several other countries, including Spain, Germany, and Japan, are extra-regional observers. SICA aims to promote regional peace, liberty, democracy, and development, with a focus on human rights. Its objectives include regional integration, the formation of a free trade area and customs union, infrastructure integration, a common stance on regional and global issues, and a common passport and visa policy.
India's UPI is a real-time, mobile-based payment system that enables instant personal and merchant payments. Developed by the National Payments Corporation of India (NPCI) in 2016, it facilitates seamless and secure fund transfers between bank accounts using mobile apps. UPI has revolutionized India's digital payments landscape by providing a fast, secure, and cost-effective payment solution for banks, consumers, and merchants. It has simplified business-to-consumer, business-to-business, and peer-to-peer payments, promoting digital inclusion and reducing dependency on cash. UPI transactions are typically free, encouraging widespread use and small-value transactions. The UPI system overall has about 450 million users. As of May 2024, UPI processes over seventy-five percent of the country's retail digital payments.
UPI offers several advantages, including seamless and instant transactions, a simplified payment experience, enhanced security, and interoperability. Users can send and receive money in real-time using a UPI ID or QR code, eliminating the need for bank account details or IFSC codes. The platform consolidates multiple bank accounts into a single app, making it convenient for users to manage finances and initiate transactions. UPI incorporates security features such as two-factor authentication, PIN, and biometric verification to ensure the safety of transactions. The UPI platform is much more than just instant transfers. UPI-based mobile apps allow you to do much more, from checking your transaction history to your account balance. As the regulatory authority monitors it, it is entirely safe and secure. Payments happen through virtual addresses, so there's no need to remember bank account numbers or IFSC codes. UPI IDs also safeguard users from data breach issues.
EAM Jaishankar highlighted the growing interest of Indian companies in SICA economies, particularly in agriculture, renewable energy, pharmaceuticals, and IT. He affirmed India's commitment to fostering closer economic ties with SICA, noting that these sectors are crucial for sustainable development and mutual growth.
India's engagement with SICA has increased significantly over the past decade, with high-level visits demonstrating a commitment to deepening ties. Jaishankar has visited Panama and the Dominican Republic. India views SICA as a vital partner under the South-South Cooperation framework, and both share challenges in development, poverty alleviation, and climate change. The India-SICA Foreign Minister's Meeting serves as a valuable forum for exchanging perspectives on development, global outlook, and cooperation opportunities.
