SINGAPORE: Singapore and India on Tuesday (Feb 21) launched a real-time link to facilitate cross-border fund transfers between bank accounts or e-wallets, using mobile phones.
This is possible through a tie-up between Singapore’s PayNow facility and India’s Unified Payments Interface (UPI).
Customers of participating financial institutions can transfer funds using just their mobile phone number, UPI identity or Virtual Payment Address.
“The linkage provides customers with a safe, simple and cost-effective way to make cross-border fund transfers,” said the Monetary Authority of Singapore (MAS) in a media release.
In Singapore, the service will be made available in phases to customers of DBS and fintech company Liquid Group.
For a start, selected DBS customers will be able to transfer funds of up to S$200 per transaction, capped at S$500 per day. By Mar 31, the service will be available to all DBS customers, who may transfer funds of up to S$1,000.
In India, four banks – State Bank of India, Indian Overseas Bank, Indian Bank and ICICI Bank – will facilitate both inward and outward remittances to begin with, while Axis Bank and DBS India will facilitate inward remittances.
A user in India can remit up to 60,000 Indian rupees (US$725) a day for a start.
The payments tie-up was officiated by Singapore Prime Minister Lee Hsien Loong and his Indian counterpart Narendra Modi at a virtual event.
Cross-border retail payments and remittances between India and Singapore currently amount to more than US$1 billion annually, said Mr Lee.
“The PayNow-UPI linkage will offer cheaper, faster and safer cross-border retail payments and remittances, for businesses and individuals alike, directly between bank accounts or e-wallet,” he added.
“As we progressively add more users and use cases, the PayNow-UPI linkage will grow in utility and contribute more to facilitating our trade and our people-to-people links.”
Mr Modi noted that the linkage will help migrant workers, professionals, students and their families.
“This will enable people from both countries to immediately and at low-cost transfer funds (by) just using their mobile phones,” he added.
MAS said the PayNow-UPI linkage is the world’s first real-time payment systems linkage to use a scalable cloud-based infrastructure which can accommodate future increases in the volume of remittance traffic.
Together with the Reserve Bank of India (RBI), it will review and progressively increase the number of participating financial institutions.
“The PayNow-UPI linkage is the result of extensive collaboration between MAS, RBI, both countries’ payment system operators, payment scheme owners, and participating banks and non-bank financial institutions,” said MAS.
“It is a major milestone in enhancing the infrastructure for cross border payments and supports India’s G20 presidency priorities to improve the cost, speed, access and transparency of cross border payments.”