Residents of India and Singapore can now transfer money using mobile apps like Paytm and Google Pay as the two countries on Tuesday linked their respective fast payment systems – Unified Payments Interface (UPI) and PayNow – to enable real-time cross-border fund transfer.
Singapore is the first country with which India has started a cross-border Person-to-Person (P2P) payment facility. The move will greatly benefit the Indian diaspora working in Singapore.
Reserve Bank of India (RBI) Governor Shaktikanta Das and Managing Director of Monetary Authority of Singapore Ravi Menon rolled out the transactions using the UPI-PayNow linkage.
The UPI-PayNow linkage will enable users of the two fast payment systems in either country to make convenient, safe, instant, and cost-effective cross-border funds transfer using their respective mobile apps, the RBI said in a statement.
Funds held in bank accounts or e-wallets can be transferred to/from India using just the UPI identity, mobile number, or Virtual Payment Address (VPA).
The PayNow-UPI linkage is the world’s first real-time payment systems linkage to use a scalable cloud-based infrastructure that can accommodate future increases in the volume of remittance traffic. It is also the first linkage to feature a non-bank financial institution as a participant, the Monetary Authority of Singapore said.
"The linkage will enable customers of participating financial institutions in Singapore and India to send and receive funds between bank accounts or e-wallets across the two countries in real-time," Singapore’s central bank said.
To begin with, the State Bank of India, Indian Overseas Bank, Indian Bank and ICICI Bank will facilitate both inward and outward remittances while Axis Bank and DBS India will facilitate inward remittances.
For Singapore users, the service will be made available through DBS-Singapore and Liquid Group (a non-bank financial institution). More banks will be included in the linkage over time, the RBI said.
An Indian user can remit up to Rs 60,000 in a day (equivalent to around SGD 1,000). At the time of making the transaction, the system dynamically calculates and displays the amount in both currencies.
Prime Minister Narendra Modi and his Singaporean counterpart Lee Hsien Loong virtually attended the launch event.
"This will help the Indian diaspora in Singapore, especially migrant workers/students and bring the benefits of digitalisation and FinTech to the common man through instantaneous and low-cost transfer of money from Singapore to India and vice-versa," Prime Minister’s Office said in a statement.
Acceptance of UPI payments through QR codes is already available in selected merchant outlets in Singapore, it said.
Cross-border retail payments and remittances between Singapore and India amount to over US$1 billion annually.
"Over the years, we have progressively enhanced our cross-border payment connectivity. In 2018, Singapore’s NETS worked with India’s NPCI International Payments Limited to allow card and QR code payments between our two countries. Today, we are taking retail payments connectivity another step forward," Singapore’s prime minister said.
Deccan Herald is on WhatsApp Channels| Join now for Breaking News & Editor's Picks