In a statement on Tuesday, PhonePe said the approval was granted after preliminary regulatory vetting. However, final approval from the central bank is still required to start commercial operations.

Reuters reported that under the two proposed licenses, PhonePe may get the opportunity to offer various services, including retail payments, card-based payments and storing customer funds. After final approval, they plan to work with local banks, licensed payment service providers and technology companies.

PhonePe, which started its journey in 2016, is currently one of India's largest digital payment platforms. These services—mobile recharge, bill payment and money transfers—are operated through the Unified Payments Interface (UPI).

The move to obtain a license in the UAE is being seen as part of PhonePe's international expansion plans. However, it has not yet been announced what types of services will be offered and when commercial operations will begin after final approval.

Earlier, in March this year, PhonePe temporarily suspended its proposed IPO due to geopolitical uncertainty and global market volatility. The company said the process would resume once market conditions stabilized.