India stalls Alipay+ payments link over security, data concerns, sources say
NEW DELHI/MUMBAI: Alipay+‘s proposal to link with India’s instant payments system for cross-border transactions has been stalled due to national security concerns in New Delhi and questions about the storage and use of customer data, three sources familiar with the discussions said. The proposal, made by Alipay+ in January, was the first by a China-linked entity in the financial services sector…
Alipay+'s attempt to link with India's instant payments system, the Unified Payments Interface (UPI), for cross-border transactions has been delayed due to national security concerns and worries about handling customer data, according to sources familiar with the matter. The proposal, introduced by Alipay+ in January, marked the first such initiative from a China-associated firm in India's financial services industry, occurring as India and China worked towards reducing tensions following a deadly border clash in 2020.
India and China are coordinating to preserve peace along their border, with Chinese President Xi Jinping slated to attend a BRICS summit in New Delhi later this month, seen as an attempt to stabilize relations between the two nations. Indian officials raised concerns over Alipay+’s proposal, citing its Chinese affiliations, cybersecurity risks, and the potential misuse of customer data.
The government's decision, based on political grounds, has no clear resolution path. Alipay+ is controlled by Singapore-based Ant International, a fintech firm spun off from China's Ant Group in 2024. India’s external affairs, finance, home affairs, Reserve Bank, National Payments Corporation, and Ant International declined to comment.
India’s security agencies have expressed concerns over potential money-laundering risks and the possibility of data breaches, leading to heightened scrutiny of China-linked entities. The financial services sector in India remains tightly regulated, even after the easing of restrictions on Chinese companies in March following the 2020 border dispute.
The proposal to integrate Alipay+ with UPI is part of a broader trend among regional payment systems, such as those in Malaysia, the Philippines, South Korea, Singapore, and France, which are seeking to streamline cross-border payments and reduce costs. The market for outbound cross-border payments in the Asia-Pacific region is projected to grow to $23.8 trillion by 2032, nearly doubling from 2024.
Written by urgent.news from Business Recorder's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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