In a first, India links online payment systems for seamless cross-border transactions
21 February, 2023 | Pragati Singh
The integration of both countries' payment systems would allow inhabitants of both countries to transfer cross-border remittances more quickly and cheaply.
In a first-of-its-kind collaboration with another country, India and Singapore integrated their respective online payment systems — India’s Unified Payments Interface (UPI) and Singapore’s PayNow — on Tuesday to allow for seamless cross-border transactions between the two countries. Prime Minister Narendra Modi and Singaporean counterpart Lee Hsien Loong attended the virtual launch event.
The integration of both countries’ payment systems would allow inhabitants of both countries to transfer cross-border remittances more quickly and cheaply. Individuals in both nations will be able to send money in real time via QR codes or by simply entering cell phone numbers linked to their bank accounts.
“The linking of fintech services between India and Singapore will take the technology to a new level,” PM Modi said at the launch event.
“It will provide low-cost real-time platform for remittance transfers to people in both countries,” Modi said.
The launch event was also attended by Shaktikanta Das, governor of the Reserve Bank of India (RBI), and Ravi Menon, managing director of the Monetary Authority of Singapore (MAS), the country’s primary financial authority. India has emerged as one of the fastest-growing environments for fintech innovation, and the PM Modi-led government has played a key role in accelerating the globalisation of India’s digital payment infrastructure.
PM Modi has placed a strong emphasis on ensuring that the benefits of UPI are not limited to India alone, but that other countries benefit as well. This agreement will also benefit the Indian diaspora in Singapore, particularly migrant workers and students, by allowing for rapid and low-cost money transfers from Singapore to India and vice versa.
Separately, given the popularity of the UPI payment system, the Reserve Bank of India recommended allowing all inbound visitors to India to utilise UPI for merchant payments while in the country. In India, the UPI payments system has proven extremely popular for retail digital payments, and its use is rapidly expanding.
The declaration was made by the RBI governor on February 8 while debating on the outcome of the three-day monetary policy committee meeting. To begin, travellers from G-20 countries arriving at “certain international airports” will be eligible for the service.