US criticises NPCI for ‘favouring’ local players | NPCI has repeatedly refused to share RuPay EMV NCMC Chip technology with American Visa & Mastercard:
The US criticizes India's NPCI for favoring local players in digital payments, citing market share limits and hindrances to foreign firms like Visa and Mastercard. The move has sparked concerns, potentially leading to reciprocal tariffs.
The National Payment Corporation of India (NPCI) has come under criticism from the US for alleged discrimination against foreign firms by limiting the market share by electronic payment service providers.
The National Trade Estimate report by the US Trade Representative office submitted to president Donald Trump on Monday that details tariff and non-tariff barriers faced by American businesses in 59 jurisdictions including the European Union (EU), singled out NPCI for favouring domestic players over foreign suppliers.
In November 2020 the state-owned NPCI – which has been promoted by Reserve Bank of India and 10 biggest banks of the country – announced a market share limitation of 30% measured by transactions for foreign electronic payment service suppliers processing online payments made through India’s Unified Payment Interface (UPI). NPCI has developed and owns UPI.
Foreign digital payment companies were given until December 2024 to ensure their market shares met the 30 % limit. Now the time limit has been extended by two years to December 2026.
Two American firms together dominate the UPI payments in the country with a staggering 85% market share- Walmart-owned Phone Pe 48.3% and Google Pay 37%.
It is widely believed that after allowing the two third party apps to invest heavily in spreading digital payment across the country, the two are now being asked to roll back in an attempt to give a fillip to Indian companies. This order from the NPCI has negatively impacted the business prospects of the two companies in India.
Explaining how the NPCI order was impacting the business in the country, Phone Pe’s chief executive officer, Sameer Nigam had recently said that Phone Pe’s public listing plans were being hindered by the impending limit.
Calling the NPCI a ‘state-owned’, the USTR report opens the door for the possibility of strong action by the US government, which will announce reciprocal tariffs in the next few hours. These reciprocal tariffs will seek to balance out tariff and non-tariff barriers being faced by the US businesses in exporting and doing business in other countries.
The USTR report has noted how NPCI has repeatedly refused to share the qSPARC standards with American electronics payments firms- Visa & Mastercard- and thus blocked their market access to participate in the National Common Mobility Card scheme or NCMC.
Currently the matter falls under the Ministry of Housing and Urban Affairs which has only certified NPCI owned RuPay as NCMC certified. Attempts by American card schemes to participate in NCMC have been thwarted by the ministry refusing to certify their proprietary technologies and by NPCI not sharing the qSPARC standards with them.
The US criticizes India's NPCI for favoring local players in digital payments, citing market share limits and hindrances to foreign firms like Visa and Mastercard. The move has sparked concerns, potentially leading to reciprocal tariffs.
The National Payment Corporation of India (NPCI) has come under criticism from the US for alleged discrimination against foreign firms by limiting the market share by electronic payment service providers.
The National Trade Estimate report by the US Trade Representative office submitted to president Donald Trump on Monday that details tariff and non-tariff barriers faced by American businesses in 59 jurisdictions including the European Union (EU), singled out NPCI for favouring domestic players over foreign suppliers.
In November 2020 the state-owned NPCI – which has been promoted by Reserve Bank of India and 10 biggest banks of the country – announced a market share limitation of 30% measured by transactions for foreign electronic payment service suppliers processing online payments made through India’s Unified Payment Interface (UPI). NPCI has developed and owns UPI.
Foreign digital payment companies were given until December 2024 to ensure their market shares met the 30 % limit. Now the time limit has been extended by two years to December 2026.
Two American firms together dominate the UPI payments in the country with a staggering 85% market share- Walmart-owned Phone Pe 48.3% and Google Pay 37%.
It is widely believed that after allowing the two third party apps to invest heavily in spreading digital payment across the country, the two are now being asked to roll back in an attempt to give a fillip to Indian companies. This order from the NPCI has negatively impacted the business prospects of the two companies in India.
Explaining how the NPCI order was impacting the business in the country, Phone Pe’s chief executive officer, Sameer Nigam had recently said that Phone Pe’s public listing plans were being hindered by the impending limit.
Calling the NPCI a ‘state-owned’, the USTR report opens the door for the possibility of strong action by the US government, which will announce reciprocal tariffs in the next few hours. These reciprocal tariffs will seek to balance out tariff and non-tariff barriers being faced by the US businesses in exporting and doing business in other countries.
The USTR report has noted how NPCI has repeatedly refused to share the qSPARC standards with American electronics payments firms- Visa & Mastercard- and thus blocked their market access to participate in the National Common Mobility Card scheme or NCMC.
Currently the matter falls under the Ministry of Housing and Urban Affairs which has only certified NPCI owned RuPay as NCMC certified. Attempts by American card schemes to participate in NCMC have been thwarted by the ministry refusing to certify their proprietary technologies and by NPCI not sharing the qSPARC standards with them.
