India backs local-currency payments and faster cross-border transactions, but is not in favour of a common BRICS currency; proposed BRICS Pay could connect domestic payment systems
Hyderabad: The upcoming 18th BRICS Summit in New Delhi, scheduled for December 12–13, 2026, is expected to focus heavily on global economic cooperation, geopolitical balance, de-dollarisation and the priorities of the Global South.
One of the key issues likely to come up is the development of BRICS Pay, a proposed cross-border digital payment framework aimed at making transactions between member countries faster, cheaper and less dependent on traditional international payment channels.
The proposal could gain further momentum during the 2026 BRICS Summit, although the exact timeline and final architecture will depend on decisions taken by member countries and their central banks.
What is BRICS?
BRICS originally consisted of Brazil, Russia, India, China and South Africa. The group has subsequently expanded, with countries including Egypt, Ethiopia, Iran and the United Arab Emirates joining the grouping.
The expanded BRICS represents a significant share of the world’s population and economic output and has increasingly focused on strengthening cooperation among emerging and developing economies.
Why was BRICS formed?
BRICS emerged primarily as a platform for greater economic and geopolitical cooperation among major emerging economies.
Its members have argued for greater representation of developing countries in international financial institutions such as the International Monetary Fund (IMF) and the World Bank.
Reducing excessive dependence on a single international currency and strengthening trade and financial cooperation among member countries have also become important areas of discussion.
BRICS established its own development bank
In 2014, BRICS countries established the New Development Bank (NDB) to finance infrastructure and sustainable-development projects in member and other developing countries.
The bank is headquartered in Shanghai and has become one of the key financial institutions associated with BRICS cooperation.
What could happen at the 2026 BRICS Summit?
The 18th BRICS Summit in New Delhi is expected to discuss ways to make cross-border payments between member countries more efficient.
Among the issues under discussion are the possible interoperability of domestic fast-payment systems and greater connectivity between central bank digital currencies (CBDCs).
BRICS finance ministers and central bank representatives have also been discussing financial cooperation, payment systems and the greater use of national currencies in bilateral trade.
India does not support a common BRICS currency
India’s position on a proposed common BRICS currency has remained different from that of some other members.
While Russia and some other BRICS countries have pushed for mechanisms that could reduce dependence on the US dollar, India has generally favoured greater use of national currencies in bilateral trade rather than creating a new common currency.
For India, the focus is on facilitating trade in currencies such as the Indian rupee, Russian ruble, Chinese yuan and UAE dirham, while making cross-border payments faster, cheaper and more efficient.
What is BRICS Pay?
BRICS Pay is being discussed as a cross-border payment framework designed to facilitate transactions between BRICS economies.
The concept is aimed at enabling users and businesses to make payments across participating countries without relying entirely on the US dollar or traditional correspondent-banking channels.
The broader idea involves greater interoperability between domestic payment systems such as India’s UPI, Brazil’s Pix and other national payment and financial messaging systems.
If successfully implemented, a consumer or business could potentially make a payment in one country while the recipient receives funds in their local currency.
How could BRICS Pay work?
A simplified example explains the concept.
Suppose an Indian company purchases goods from a Brazilian company. Under a conventional system, the transaction may involve currency conversion and intermediary banks.
Under a local-currency payment arrangement, the Indian buyer could pay in rupees while the Brazilian seller receives Brazilian reais, with the exchange and settlement mechanism operating between the participating financial institutions.
This could reduce the need for multiple currency conversions and potentially lower transaction costs.
However, the exact settlement mechanism, exchange-rate arrangements, regulatory framework and participating institutions would have to be finalised before such a system could operate at scale.
What could BRICS Pay mean for India?
For India, a functioning cross-border payment network could offer several potential advantages.
Lower transaction costs: Reducing the number of intermediaries and currency conversions could make international payments cheaper.
Faster payments: Connecting domestic instant-payment systems could reduce settlement times for eligible transactions.
Greater use of the rupee: More bilateral trade conducted directly in rupees could increase the international use of the Indian currency.
Benefits for tourism: If payment systems become interoperable, tourists could potentially use familiar digital wallets or QR-based payment systems in participating countries.
Reduced dependence on correspondent banks: Greater direct connectivity could reduce reliance on traditional intermediary banking channels for some transactions.
What is India’s approach to BRICS Pay?
India’s approach appears to focus less on using BRICS Pay as an explicitly anti-dollar mechanism and more on reducing payment costs, improving efficiency and encouraging local-currency trade.
Reserve Bank of India Governor Sanjay Malhotra has highlighted the potential benefits of connecting fast-payment systems and exploring links between central bank digital currencies.
The RBI has also been examining the possibility of linking CBDCs for cross-border use cases such as trade and tourism.
India vs Russia: Different priorities
Russia has a stronger strategic interest in reducing its dependence on Western financial infrastructure following the sanctions imposed on Moscow after its invasion of Ukraine.
For Russia, developing alternative financial messaging and payment mechanisms is closely connected with reducing exposure to the dollar and Western-controlled financial infrastructure.
India, however, has maintained a more pragmatic approach.
New Delhi has strong economic and strategic relationships with both the United States and BRICS countries. Therefore, India has an interest in expanding local-currency payments without necessarily turning the initiative into a political project aimed at replacing the dollar.
Will BRICS Pay make the rupee stronger?
It could support the rupee, but BRICS Pay alone cannot guarantee a stronger rupee.
If more international trade involving India is settled directly in rupees, the need for dollar-based transactions could decline for those specific trades.
For example, if an Indian importer can settle a transaction with a participating country through a local-currency mechanism instead of first converting rupees into dollars, demand for dollars associated with that transaction could potentially fall.
This could reduce some pressure on India’s foreign-exchange market.
However, the rupee’s overall value depends on much broader factors, including India’s trade balance, capital flows, inflation, interest rates, crude-oil prices, foreign-exchange reserves and global dollar demand.
Could the rupee gain greater global acceptance?
Greater use of the rupee in international trade could increase its international relevance.
If more BRICS partners routinely accept and hold rupees for trade settlement, Indian businesses could potentially conduct more transactions without first converting their currency into dollars.
Over time, wider international use could strengthen the rupee’s role in the global financial system.
But this would depend heavily on whether India’s trading partners actually have sufficient demand for Indian goods and services and whether they are willing to hold rupee balances.
Could businesses save billions through BRICS Pay?
A more efficient cross-border payment system could potentially reduce costs associated with correspondent banking, foreign-exchange conversion and payment processing.
However, claims that BRICS Pay would automatically save Indian businesses more than $9 billion annually should be treated cautiously unless supported by an official estimate based on the final system design and transaction volumes.
The actual savings would depend on participating countries, transaction volumes, exchange-rate mechanisms, banking charges and the final technical architecture.
Local-currency trade does not automatically mean a stronger rupee
There is another important factor: India’s import-export balance.
Suppose India imports substantially more from a BRICS partner than it exports to that country. That country could accumulate large rupee balances.
If there are not enough opportunities to use those rupees to purchase Indian goods, services or assets, the currency arrangement could create settlement imbalances.
A similar issue has emerged in India’s trade relationship with Russia, where bilateral trade has been heavily tilted toward Indian imports from Russia.
Therefore, increasing rupee-based trade is only one part of the equation. India would also need to increase exports and create sufficient international demand for the rupee.
When could BRICS Pay be implemented?
The development of a BRICS cross-border payment framework is expected to be gradual rather than an overnight replacement for existing international payment systems.
A potential implementation could begin with limited use cases such as tourism and retail payments, followed by broader bilateral trade transactions.
A fully interoperable system connecting multiple national payment networks would require extensive coordination among central banks, commercial banks, payment companies, regulators and technology providers.
BRICS Pay is not the same as a BRICS currency
This distinction is crucial.
BRICS Pay refers to a proposed mechanism for facilitating cross-border payments and interoperability.
A common BRICS currency would be an entirely different proposal involving the creation of a new shared currency.
India has shown greater interest in the first approach—interoperable payment systems and local-currency settlement—than in creating a common BRICS currency.
Bottom line
BRICS Pay could become an important development in cross-border payments if member countries successfully connect their domestic payment systems and establish reliable local-currency settlement mechanisms.
For India, the biggest potential benefits would be lower transaction costs, faster payments, greater use of the rupee and easier digital payments for trade and tourism.
But BRICS Pay should not be viewed as a guaranteed mechanism for strengthening the rupee or eliminating the US dollar from international trade. The dollar is deeply embedded in global finance, and India’s currency strength will continue to depend on trade flows, capital movements and broader economic fundamentals.
India’s approach is therefore likely to remain pragmatic: promote rupee and other local-currency trade, build efficient digital payment connectivity and reduce unnecessary transaction costs—without committing to a common BRICS currency.
