Bengaluru based PhonePe has received licences from the Central Bank of the UAE to start local operations in the United Arab Emirates, its first full market outside India. Founder and Chief Executive Officer Sameer Nigam announced the move at the Global Fintech Fest 2026 in Mumbai on 9 September 2026. The launch allows PhonePe to offer local consumer payment tools and merchant acceptance systems in the UAE, instead of only supporting Indian travellers using UPI abroad.
What Has PhonePe Announced in the UAE?
PhonePe has secured its first international licences from the Central Bank of the UAE (CBUAE), which is the regulator for banks, payment systems and financial activities in the UAE. With these approvals, PhonePe will set up local operations in the UAE and offer full payment services within the country. This is a shift from its first ten years, when its business was focused almost entirely inside India.
The announcement was made at the Global Fintech Fest (GFF) 2026 in Mumbai, one of the largest annual meetings for the fintech industry in India. Nigam said the UAE will be PhonePe’s first foreign market where it operates locally with its own licences. The company has not yet announced a date for the start of customer services, but the licences clear the main regulatory step for the launch.
What Do the Two UAE Licences Cover?
PhonePe has received two separate permissions. The first covers consumer payment instruments, which are tools that customers use to pay, such as wallets, prepaid cards and other stored value accounts. The second covers e-payment acceptance infrastructure for merchants, which are systems that help shops and businesses accept digital payments, such as QR codes, point of sale machines and online payment gateways.
| Licence Area | What It Means in Simple Terms |
|---|---|
| Consumer payment instruments | PhonePe can issue payment tools to people in the UAE to store money and pay for goods and services |
| Merchant e-payment acceptance | PhonePe can give UAE shops and online sellers the systems to accept digital payments from customers |
In the UAE, such activities are regulated under the Stored Value Facilities (SVF) Regulation of 2020 and the Retail Payment Services and Card Schemes Regulation of 2021. The SVF rules cover e-wallets and prepaid instruments where a customer pays money in advance and stores value for later use. The retail payments rules list nine payment services, including payment account issuance, payment instrument issuance, merchant acquiring and payment aggregation. Any non-bank company that wants to offer these services must take a licence from the Central Bank of the UAE and follow its rules on safety of customer funds, risk control and business conduct.
How Is Local Operation Different From UPI Use in Dubai?
PhonePe users could already use UPI at some shops in Dubai before this announcement, but that was a limited cross border facility. UPI, or Unified Payments Interface, is India’s instant real time payment system that links bank accounts to a mobile app for immediate transfers. It is operated in India by the National Payments Corporation of India (NPCI), and its international arm NPCI International Payments Ltd (NIPL), set up in 2020, builds UPI acceptance in other countries.
In February 2023, PhonePe became the first Indian fintech app to enable UPI International, which allowed Indian travellers to scan local QR codes and pay from their Indian bank accounts in the UAE, Singapore, Mauritius, Nepal and Bhutan. In March 2024, PhonePe tied up with Mashreq Bank’s NEOPAY terminals in the UAE so visitors could pay at retail stores, restaurants and tourist spots such as Dubai Duty Free and Lulu Hypermarket. In those transactions, the amount was debited in Indian rupees after currency conversion. Non resident Indians with UAE mobile numbers could also link their NRE (Non Resident External) and NRO (Non Resident Ordinary) accounts to the PhonePe app for payments in India.
| Earlier UPI Facility in UAE | New Local Operation in UAE |
|---|---|
| Meant mainly for Indian tourists and non resident Indians visiting the UAE | Meant for anyone living in the UAE, including local residents and businesses |
| Payment was linked to an Indian bank account and settled in rupees | Payment can be issued and settled locally under UAE regulation |
| Accepted only at select terminals enabled by partners like NEOPAY and Network International | Can build its own merchant network with QR, point of sale devices and online gateway |
UPI acceptance has since spread wider. UPI is now accepted for in store payments in countries including the UAE, Singapore, Nepal, Sri Lanka, Bhutan, Mauritius, France, Qatar, Cambodia and Greece, with Uzbekistan set to join after an agreement signed on 30 August 2026. The new UAE licences move PhonePe beyond this traveller focused model to full domestic payment services inside a foreign country.
What Is PhonePe and How Large Is Its Network in India?
PhonePe is an Indian digital payments and financial services company headquartered in Bengaluru, Karnataka. It was founded in December 2015 by Sameer Nigam, Rahul Chari and Burzin Engineer. The PhonePe app, which works on the UPI platform and is available in 11 Indian languages, went live in August 2016 after a partnership with Yes Bank. Flipkart acquired the company in 2016, and the firm later came under majority ownership of the American retail group Walmart. In 2022, PhonePe shifted its domicile from Singapore to India and separated from Flipkart to operate as an independent group.
PhonePe is now India’s largest UPI app by transaction share. As of July 2026, it reported more than 71.8 crore lifetime registered users and a merchant network of more than 5 crore stores, apps and websites across 98 percent of India’s postal codes. Its revenue rose to ₹7,115 crore in 2024-25. Starting from money transfer, mobile recharge and bill payments, the group has expanded into insurance distribution, lending on a marketplace model, wealth management and new consumer platforms such as Share.Market for stocks and mutual funds, Pincode for hyperlocal shopping and the Indus Appstore for Android apps. In April 2025, it converted from a private limited company to PhonePe Limited, a public company, as part of its preparation for a stock market listing.
Why the UAE Is a Strategic First Overseas Market
The UAE is a natural starting point for an Indian payment company going abroad. It hosts one of the largest Indian communities in the world and receives millions of Indian tourists and workers every year. Payments for shopping, dining and travel, along with money sent home by workers to families in India, create a large and steady flow of cross border transactions between the two countries. India and the UAE also share close trade ties after the Comprehensive Economic Partnership Agreement (CEPA) signed in 2022, which cut duties and set a target for higher bilateral trade.
The UAE is also positioning itself as a regional fintech hub with clear licensing for wallets and retail payments. At the same event in Mumbai, PhonePe announced a partnership with Visa to launch Tap to Pay for contactless phone payments, Cross Border Scan to Pay for QR payments in 14 international markets and Smart Accept to help small shops accept card payments on a phone without a separate machine. Together, the UAE licences and the Visa products show a common goal, which is to let Indian travellers pay abroad without cash or physical cards and to let UAE merchants accept those payments on the same system.
Significance for Cross Border Payments and Way Forward
Cross border payments are payments where the payer and the receiver are in different countries and the money must move across currencies and banking systems. For India, faster and cheaper cross border payments matter because India is the world’s largest receiver of money sent home by workers abroad, and the UAE is one of the biggest sources of such flows. A local presence in the UAE can help PhonePe serve both the tourist who pays at a Dubai mall and the worker who sends earnings to family in India. PhonePe has earlier said it plans to add inward remittance services through UPI once the corridor is enabled, which would let users receive money from abroad directly into a bank account without account numbers or IFSC codes.
The move also comes amid growing competition among Indian fintech firms to expand abroad. Days before PhonePe’s announcement, Paytm said it had received a payment institution licence from the financial regulator in Luxembourg to offer services across Europe. Global fintech firms such as Revolut have also taken Stored Value Facilities and retail payment licences in the UAE in 2026. For PhonePe, the next steps will be to complete local setup, link with UAE banks and merchant networks, and start customer onboarding under Central Bank of the UAE supervision. If the UAE model succeeds, it could become a template for entry into other markets in the Gulf and Southeast Asia where Indian travel and trade links are strong.
Key Takeaways
- PhonePe will launch local operations in the UAE, its first full market outside India, after receiving licences from the Central Bank of the UAE.
- The move was announced by Sameer Nigam on 9 September 2026 at the Global Fintech Fest 2026 in Mumbai.
- The two licences cover consumer payment instruments and e-payment acceptance infrastructure for merchants under UAE payment regulations.
- PhonePe, founded in December 2015 and headquartered in Bengaluru, is majority owned by Walmart and serves more than 71.8 crore registered users.
- The launch moves beyond UPI International, which since 2023 allowed Indian travellers to pay from Indian bank accounts at select UAE terminals through partners like Mashreq NEOPAY.
