Alipay+'s proposal to integrate with India's instant payment system Unified Payments Interface (UPI) has hit a roadblock over national security concerns, Reuters reported citing three people with knowledge of the matter.

The Indian government's concerns emerge from Alipay+'s links to China and revolve around how consumer data will be used and stored, with risks of money laundering, data breaches and cyberfraud taking center stage, Reuters said.

India's foreign ministry said the proposal was paused on "political grounds," according to one of the sources familiar with the discussions.

The link-up, which was proposed in January, aims to enable Indians traveling to China and Hong Kong among other parts of Asia to make real-time payments at Alipay+ merchants.

In the long term, international travelers to India would also be able to use Alipay+, which is run by Alibaba's (HKG:9988) Ant International.

Ant International, Reserve Bank of India, National Payments Corporation of India, and India's ministries of external affairs, finance, and home affairs did not immediately respond to a request for comment from MT Newswires.

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