The Reserve Bank of India joined hands with the Monetary Authority of Singapore, on September 14, to link their fast payment systems India’s Unified Payments Interface (UPI) and Singapore’s PayNow. The RBI and its Singaporean counterpart will undertake the project.
In a notification, the RBI said that the UPI-PayNow collaboration will facilitate users to make low-cost cross-border find transfers in an instant on a reciprocal basis without a need to get onboarded onto the other payment system. The UPI-PayNow linkage is expected to be operationalised by July 2022.
The RBI called the UPI-PayNow linkage a noteworthy milestone in developing a cross-border payment infrastructure between India and Singapore. “It closely aligns with the G20’s financial inclusion priorities of driving faster, cheaper and more transparent cross-border payments,” said RBI. The initiative is also in line with the apex bank’s vision of reviewing corridors and charges for inbound cross-border remittances outlined in the Payment Systems Vision Document 2019-21.
The linkage builds upon NPCI International Private Ltd (NIPL) and Network for Electronic Transfers (NETS) to foster cross-border payments using cards and QR codes between India and Singapore and will further anchor trade, travel, and remittance flows between the two countries.
India’s fast payment facility UPI enables customers to make round the clock payments in an instant through a Virtual Payment Address (VPA) which is created by the user. Such a platform eliminates the risk of sharing bank account details by the user. UPI supports both Person to Person (P2P) and Person to Merchant (P2M) payments. Also, the platform enables the user to send or receive money. While the Singaporean counterpart of UPI, PayNow enables peer-to-peer funds transfer service. The payments platform is also available to retail customers through participating banks and Non-Bank Financial Institutions (NFIs) in Singapore.