Mumbai: India and Singapore will connect the fast payment system of each – an integrated payment interface (UPI) and Paynow – to allow users to make a transfer of low-cost funds instantly with a reciprocal basis, said Reserve Bank on Tuesday.
Reserve Bank of India (RBI) and Monetary Authority Singapore (MAS) announced the project to link a fast payment system.
This link is targeted for operationalization in July 2022, RBI said in a statement.
“The UPI-Paynow link will allow users from each of the two quick payment systems to make the transfer of low-cost funds instantly on the basis of reciprocity without the need to rise to other payment systems,” he said.
RBI said the UPI-Paynow link was an important milestone in the development of infrastructure for cross-border payments between India and Singapore, and parallel to the priority of the G20 financial inclusion driving faster, cheaper, and more transparent cross-border payments.
Linkage was built based on previous efforts from NPCI International Private Limited (NIPL) and network for electronic transfers (nets) to foster cross-border payment interoperability using cards and QR codes, between India and Singapore.
It will further anchor trade, travel and re-delivery between the two countries.
This initiative is also in line with the RBI’s vision about reviewing the corridor and costs for inbound cross-boundary remittances described in the 2019-21 payment system vision document.
This must be mentioned here that UPI is a cellular-based fast payment system that facilitates customers to enable hours of payment hours instantly using the virtual payment address (VPA) made by customers.
This eliminates the risk of sharing the details of the bank account by the remitter.
UPI supports people-to-person payments (P2P) and person-to-merchants (P2M) and allows users to send or receive money.
Paynow is a Singapore Fast payment system that enables peer-to-peer fund transfer services, available to retail customers through participating banks and non-bank financial institutions (NFIS) in Singapore.
This allows users to send and receive instant funds from one bank account or e-wallet to another in Singapore by using only their cellphone numbers, Singapore Nric / Fin, or VPA.