PhonePe has received in-principle approval from the Central Bank of the UAE (CBUAE) for 2 payment licences, moving the fintech closer to launching a locally regulated payments business in the country.
The Bengaluru-based company said on September 22 that it has completed the initial regulatory due diligence. It will need final approval from the UAE central bank before starting commercial operations.
The approvals cover Retail Payment Services and Card Schemes (RPSCS) and Stored Value Facilities (SVF).
“The country’s vision and regulatory environment make it an ideal setting for our international journey. By combining technology with local partnerships, PhonePe intends to support the strong economic and trade corridors connecting the UAE, India, and global markets,” said Ritesh Pai, CEO and Executive Director of International Payments at PhonePe.
PhonePe already operates in the UAE through UPI. Through its partnership with NPCI International Payments Limited (NIPL), Indian users can scan local QR codes and make payments through NEOPAY and Network International terminals.
UPI, operated by the National Payments Corporation of India (NPCI), is available in more than 15 countries. PhonePe is India’s largest UPI platform, with more than 45% market share. The company processes nearly 12 billion transactions every month, worth around Rs 14 lakh crore.
The UAE expansion would take PhonePe beyond enabling UPI payments for Indian users and towards building a locally regulated payments business.
The company plans to work with UAE banks, licensed payment service providers and technology companies to connect with the country’s domestic payments infrastructure. PhonePe also plans to explore opportunities to support Aani, the UAE’s instant payment platform, and Jaywan, its domestic card scheme.
The UAE has become an important market for UPI, supported by its large Indian population and the high number of Indian visitors. Partnerships between NIPL and UAE payment companies have expanded UPI acceptance among merchants.
PhonePe said the UAE’s Financial Infrastructure Transformation (FIT) programme and its push towards a digital-first economy were among the factors behind its decision to enter the market.
With more than 700 million registered users and 50 million merchants, the UAE could also become an important market for PhonePe as it develops its broader international payments strategy.
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