PhonePe has taken an important step towards launching a regulated payments business in the UAE after receiving in principle approval from the Central Bank of the UAE for two payment licences.
The approvals cover Retail Payment Services and Card Schemes and Stored Value Facilities. This marks PhonePe’s first regulatory approval outside India and brings the company closer to entering the UAE as its first international market.
The approval does not mean PhonePe can start offering commercial services yet. The company still needs to complete the remaining regulatory requirements and receive final approval from the Central Bank of the UAE before it can begin operations.
PhonePe has already enabled Indian travellers to make payments in the UAE through existing cross border payment arrangements. The new approvals take the company towards a different type of presence, where it can build a locally regulated payments business and work with the UAE’s financial ecosystem.
PhonePe plans to build its UAE business around local payment infrastructure
The two licences give PhonePe a regulatory foundation for a wider range of payment services in the UAE.
The Retail Payment Services and Card Schemes licence covers regulated payment services and card activities. The Stored Value Facilities licence covers services where customer funds are held before they are used, including wallet and similar stored value products.
PhonePe plans to work with regional banks, licensed payment service providers and local technology vendors once it receives final approval. This means the company intends to build its UAE operation through local partnerships and existing financial infrastructure.
The company also plans to explore opportunities involving Aani and Jaywan.
Aani is the UAE’s instant payment platform, while Jaywan is the country’s domestic card scheme. PhonePe intends to explore ways to support both payment systems through its full stack technology platform.
This planned integration is significant because PhonePe is not looking to operate separately from the UAE’s domestic payments network. Its approach is focused on working alongside the systems already used by financial institutions, businesses and consumers in the country.
Jaywan also has a direct technology connection with India. The UAE’s domestic card scheme was developed through a partnership involving Al Etihad Payments and NPCI International, with technology from India’s RuPay network forming part of the system.
PhonePe’s planned entry therefore builds on an existing connection between the payment ecosystems of the UAE and India.
Ritesh Pai, CEO and Executive Director of International Payments at PhonePe, said the company plans to combine its technology with local partnerships to support the economic and trade links connecting the UAE, India and global markets.
PhonePe also brings considerable experience in managing digital payments at scale. The company says its platform currently serves more than 700 million registered users and 50 million merchants in India.
The UAE will give the company a new operating environment, however. PhonePe will need to adapt its services to local regulations and work closely with UAE-based financial and technology partners.
PhonePe’s UAE presence could expand beyond payments for Indian travellers
PhonePe already has a presence in the UAE through its partnership with NPCI International Payments Limited.
Indian travellers can use the PhonePe app to scan local QR codes and make payments at participating merchants through NEOPAY and Network International terminals. These services are enabled through existing cross border payment arrangements.
The new approvals could change the scope of that presence.
The current arrangement mainly allows Indian users to use their existing payment service while travelling in the UAE. A locally regulated PhonePe business would give the company a much broader position in the market, allowing it to develop services for UAE residents and businesses within the limits of its final regulatory permissions.
That makes the latest approval an important shift in PhonePe’s international strategy. The company is moving from supporting Indian customers overseas towards establishing a regulated business in another country’s domestic financial market.
PhonePe has said the UAE will become its first international market once it receives final approval and begins commercial operations.
The UAE’s strong economic relationship with India adds further relevance to the expansion. Around nine million Indians were previously cited in the company’s business context as living across the Gulf state, while the India UAE corridor moves more than $20 billion in remittances each year.
This creates a large existing connection between the two markets. PhonePe already operates at significant scale in India, giving it a large domestic customer and merchant network as it begins its international expansion.
The move also comes at an important time for PhonePe’s wider business.
The company filed an updated draft prospectus with SEBI in January 2026 for a proposed IPO based entirely on an offer for sale. The planned transaction was later put on hold as global markets faced volatility and geopolitical uncertainty. The company’s reported target valuation for the proposed listing was between $9 billion and $10.5 billion.
PhonePe’s FY2025 financial performance also shows the scale of the business behind the expansion. Revenue reached ₹7,114.8 crore, representing 40.5% growth, while the company’s net loss fell 13.5% to ₹1,727.4 crore.
For the UAE payments sector, PhonePe’s planned entry adds another large technology driven payments company to an already developing digital financial ecosystem.
The immediate next step is still regulatory approval. PhonePe must complete the remaining requirements set by the Central Bank of the UAE before it can begin commercial operations.
If the final approval is granted, the company will move from enabling Indian travellers to make payments in the UAE to building a locally regulated payments operation. That would make the UAE the first market in PhonePe’s international expansion journey.
