Maldives recently announced its decision to introduce RuPay cards, India’s card payment network, in the country in partnership with India. This move is expected to not only potentially increase Indian tourist arrivals but also boost tourism earnings for Maldives. RuPay, which is an alternative to Visa and MasterCard in India, has been widely adopted in the country with over 700 million cards issued as of last July, making it a popular choice for card payments. Subhash Goyal, chairman of the aviation and tourism committee of the Indian Chamber of Commerce, believes that the acceptance of Indian Rupees will encourage more Indian tourists to visit the Maldives.
The decision to introduce RuPay cards in Maldives came after months of diplomatic tensions between India and Maldives, following a social media post by Indian Prime Minister Narendra Modi promoting Lakshadweep islands as an alternative to Maldives. This led to backlash from the Maldivian government, causing a significant drop in Indian travelers visiting the country. By introducing RuPay cards and potentially Unified Payment Interface (UPI) in the future, Maldives aims to increase spending by Indian tourists through convenience in payment options. UPI is a digital payment system that allows bank-to-bank transactions without sharing account details, and its integration in Maldives is expected to further enhance the travel spending by Indian tourists.
The use of RuPay cards and potential introduction of UPI in Maldives will not only benefit Indian tourists but also the overall tourism sector of the country. As India emerges as a significant source of outbound tourism, destinations are adapting to accept digital payments preferred by Indian travelers. France, for example, has enabled Indian tourists to pay for tickets to popular attractions in rupees through UPI, reflecting the growing trend of digital payments in the travel industry. A report by Booking.com and McKinsey projected a significant rise in travel spending by Indians from $150 billion in 2019 to $410 billion by 2030, indicating the potential impact of targeting this market segment.
With the increasing preference for digital payments in India, especially UPI, the move to introduce RuPay cards and potentially UPI in Maldives aligns with the changing consumer preferences. A study by consulting firm Kearney revealed that a majority of respondents in India prefer digital payments for both online and in-person purchases, with UPI accounting for a significant portion of retail digital payments in the country. By offering convenient payment options for Indian travelers, Maldives is poised to attract more visitors and increase spending in the tourism sector. The integration of RuPay cards and UPI is expected to streamline the payment process for Indian tourists, making their travel experiences more convenient and appealing.
Overall, the decision by Maldives to introduce RuPay cards in partnership with India has the potential to not only attract more Indian tourists to the country but also boost tourism earnings through increased spending. By adapting to the preferences of Indian travelers for digital payments, Maldives is positioning itself as a convenient and welcoming destination for this growing market segment. The move also reflects the broader trend of destinations worldwide embracing digital payment systems to cater to the changing consumer behavior and expectations. As India continues to emerge as a key source of outbound tourism, the integration of RuPay cards and potentially UPI in Maldives is a strategic move to capitalize on this lucrative market opportunity.
