UPI and Paypal to join hands: UPI payments on foreign e-commerce sites and during overseas travel may soon be a reality
According to a press release from PayPal, the online payment giant, they are working on a new platform called PayPal World, which aims to bring together various online payment systems and digital wallets globally so that they can all work together seamlessly.
As part of this initiative, PayPal today announced a partnership with NPCI International, indicating that UPI users soon will be able to do P2P (peer-to-peer) transactions with PayPal users. In other words, they'll be able to send money to each other from anywhere in the world. Right now, this feature is only available for Venmo, a popular US-based payment service. Additionally, UPI users may soon have the chance to shop online and potentially even in physical stores at millions of locations worldwide that accept PayPal. This feature is expected to roll out for Venmo starting in 2026, according to the press release. How will this impact Indian UPI users? ET Wealth Online decodes What does the PayPal World-UPI collaboration mean for Indians? PayPal World is set to launch before the end of this year. It's a payment platform that allows people to make international transactions using their local payment service or digital wallet. In the initial stage, it has teamed up with 4 payment services across the world, and UPI is one of them. These are: Mercado Pago, a popular payment service provider in Latin America
NPCI International Payments Limited (UPI)
Tenpay Global (China), which operates Weixin Pay
Venmo (USA)
The platform will allow interoperability across these platforms, meaning an Indian will be able to send money to their relative's PayPal account in the US using their UPI account. Similarly, if you want to buy some dresses online from a store in the US, right now, you need to log onto your PayPal account, click 'send and request', enter the recipient's details and amount, and choose your payment method, which can either be your linked bank account or your debit or credit card. Once UPI goes live on PayPal, users will notice the UPI button when they click on the PayPal button at checkout, allowing them to finish their transaction. For example, if you are on vacation in the USA and find a store that only accepts PayPal, you can just open your PayPal app and scan to pay with your UPI account. Explains Rohit Mahajan, Founder and Managing Partner of plutosONE: 'Going ahead, users can transact without hesitation, leveraging payment systems that are familiar to them - whether that is UPI, Weixin Pay, or Venmo. This means unprecedented freedom - shopping, sending money, and engaging with global businesses without barriers or complexities. 'It minimizes reliance on multiple platforms, simplifies cross-border transactions, and achieves a level of financial inclusivity that is long overdue. As additional participants enter an interoperable ecosystem, we see a massive shift in the payment landscape where convenience, choice, and connectivity become a baseline in digital payments', he adds. How much does PayPal currently charge?
According to Mahajan, PayPal charges around 4.4% per transaction and has an additional 4% markup on the currency exchange rate. These fees can make receiving international payments via PayPal relatively expensive.According to PayPal India's website, when it comes to the Australian dollar, Euro, the US dollar, and Yen, there's a 4% fee on top of the base exchange rate, which contributes to the overall transaction exchange rate. What will merchants have to pay to get on board PayPal World?
As PayPal clarified, "PayPal World will not charge merchants any fees to accept payments, as there is no contractual relationship between merchants and PayPal World. Merchants will continue to maintain their contractual relationship with their wallet platform/processor/acquirer (e.g., PayPal), which will determine fees charged to merchants". When is UPI expected to go live on PayPal World? NPCI has not provided a specific timeline for when this feature will be available on PayPal World. At present, neither is the PayPal World platform live, nor is this facility active on PayPal World. Also, NPCI has not made any official announcement regarding when this partnership will be accessible for Indian users.
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