News Desk
MALE’ — The Maldives Monetary Authority (MMA) has officially linked the country’s instant payment system, Favara, with India’s Unified Payments Interface (UPI), launching a digital cross-border transfer mechanism designed to streamline remittances, trade, and financial cooperation between the two nations.
At a ceremony held at the central bank on Thursday, MMA Governor Ahmed Munawar inaugurated the service alongside Minister of Foreign Affairs Irtisham Adam and Indian High Commissioner to the Maldives G. Balasubramanian.
Under the initial phase of the initiative, account holders at the Bank of Maldives (BML) and Maldives Islamic Bank (MIB) can make direct person-to-person (P2P) transfers to Indian UPI accounts via their existing banking applications. Senders can pay in Maldivian Rufiyaa or US Dollars, with funds deposited instantly into the recipient’s bank account in Indian Rupees.
The minister for economic development, transportation, and trade, Mohamed Saeed, described the integration as a strategic catalyst for the economic ties between the two countries.
“Connecting Favara and UPI is a major step forward in building our digital and financial infrastructure,” Saeed said in a statement. “It expands trade opportunities, supports business and tourism, and provides a strong foundation for the proposed India-Maldives Free Trade Agreement.”
The project, initiated under a July 2025 agreement between the MMA and NPCI International Payments Limited (NIPL), makes the Maldives one of the few nations—alongside Singapore and Nepal—to link its national payment infrastructure directly with India’s UPI system. The Indian interface processed approximately 241.6 billion transactions worth an estimated $3.56 trillion between 2025 and 2026.
According to MMA Deputy Governor Aishath Asna Hamdee, the linkage will initially accommodate essential individual transactions, including medical expenses, educational fees, and family remittances, subject to foreign exchange regulations. Individual transfers are capped at 24,000 Indian Rupees (approximately $250) per month, though commercial banks retain the discretion to set lower limits.
“This is just the beginning,” Hamdee said, noting that testing is under way to enable inbound transfers from India to the Maldives. Subsequent phases will introduce QR-code merchant payments (P2M) and expand coverage to include all local banks and payment service providers.
Authorities expect the system to significantly reduce transaction times and costs for the thousands of Maldivian medical travellers and students residing in India, as well as the substantial Indian expatriate workforce living in the Maldives.
