In a major step towards deepening digital and financial cooperation, India and the Maldives have signed a landmark Network-to-Network agreement between India's NPCI International Payments Limited (NIPL) and the Maldives Monetary Authority (MMA), paving the way for the implementation of Unified Payments Interface (UPI) in the island nation. This move highlights the growing global recognition of India's fintech leadership, with the UPI now processing over 100 billion transactions annually.

A Memorandum of Understanding (MoU) has been signed between India's Ministry of Electronics and Information Technology (Meity) and the Maldives’ Ministry of Homeland Security and Technology to promote exchange of successful, scalable digital solutions. The goal is to accelerate digital transformation in the Maldives by leveraging India’s experience in implementing digital public infrastructure at scale.

The agreements come amid a broader strategic reset in India-Maldives relations, marked by Indian Prime Minister Narendra Modi's announcement of a ₹4,850 crore (about $550 million) line of credit and a renewed framework for cooperation across critical areas—trade, defence, infrastructure, and digital connectivity. These initiatives underscore an urgent and forward-looking commitment to regional stability, economic integration, and technological advancement.

“During [the] President’s visit to India last October, we shared a vision for a comprehensive economic and maritime security partnership. That vision is now becoming a reality. As a result, our bilateral ties are reaching new heights, and several important projects have been inaugurated,” Modi said.

“We have taken several steps to accelerate our economic partnership. To boost mutual investment, we will soon work towards finalizing a Bilateral Investment Treaty. Discussions on a Free Trade Agreement have also begun…With the local currency settlement system, trade can now take place directly in Rupees and Rufiyaa. The rapid adoption of UPI in the Maldives will further strengthen both tourism and the retail sectors,” Modi added.

India’s UPI, a real-time payment system that supports peer-to-peer and merchant transactions, has seen explosive growth in recent years. In its latest annual report, the Reserve Bank of India (RBI) stated that during the financial year 2024-25, total digital payments recorded growth of 34.8% and 17.9% in volume and value terms, respectively.

“Moreover, the success of UPI placed India in a leadership position with a share of 48.5% in global real-time payments by volume,” RBI said in its report.

Overall, India and the Maldives signed several key Memorandums of Understanding (MoUs) covering vital sectors such as fisheries and aquaculture, meteorology, digital public infrastructure, Unified Payments Interface, Indian pharmacopoeia, and a new concessional Line of Credit (LoC). The newly extended Line of Credit, valued at ₹4,850 crore (approximately $550 million), is aimed at accelerating infrastructure development and other priority projects in the Maldives, according to an official statement.

In addition, an Amendatory Agreement was exchanged for the existing Lines of Credit, providing critical financial relief by cutting the Maldives’ annual debt servicing burden by 40%—from $51 million to $29 million. The two sides also exchanged the Terms of Reference for a proposed Free Trade Agreement, setting the stage for enhanced economic cooperation.

India shares digital infra as tool of soft power

India’s expansion of UPI in the Maldives marks a critical step in strengthening digital collaboration between the two nations, highlighting India’s push to share its digital public infrastructure as a soft power tool. This move paves the way for deeper financial and technological integration, facilitating cross-border remittances, trade payments, and collaborative fintech ventures. The rollout of UPI is not just a technological upgrade; it’s a strategic initiative expected to accelerate economic growth, boost tourism, advance financial inclusion, and solidify bilateral ties. It also supports the Maldives’ ambition to modernize its financial systems and improve global digital connectivity.