Singapore and India recently launched a linkage that will allow customers to send and receive funds between bank accounts or e-wallets across the two countries in real-time.
The linkage involves the Monetary Authority of Singapore (MAS) and the Reserve Bank of India (RBI) together with Singapore’s PayNow and India’s Unified Payments Interface (UPI).
In a statement, MAS said that customers of participating financial institutions in Singapore and India can now transfer funds between bank accounts or e-wallets across the two countries in real-time.
They can do this using the mobile phone number, UPI identity, or virtual payment address (VPA).
The statement said that the PayNow-UPI linkage provides customers with a safe, simple, and cost-effective way of making cross-border fund transfers.
Singapore Prime Minister Lee Hsien Loong and India Prime Minister Narendra Modi led the launch of the linkage.
And to test the system, MAS Managing Director Ravi Menon and RBI Governor Shaktikanta Das executed live cross-border fund transfers to each other from their locations in Singapore and India, respectively.
PayNow-UPI 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.
At the same time, it is also the first linkage to feature a non-bank financial institution as a participant.
MAS said in its statement that the service will be made available to customers of DBS Bank and Liquid Group in Singapore under a phased approach. This means that these institutions will progressively increase the number of eligible user groups and transaction limits from today till the end of March 2023.
Meanwhile, customers of all participating Indian banks will be able to receive funds through the service from the onset. However, sending of funds will be limited, for now, to customers of four Indian banks at the time of launch. This scope will be gradually expanded soon.
MAS and RBI will continue to review and progressively scale the linkage by increasing the number of participating financial institutions and its applicable use cases.
Following the official launch of PayNow-UPI, participating financial institutions have committed to ensuring that the service will remain cost-efficient and accessible, including to foreign workers and students, who are currently residing in Singapore and India, to enable them to make and receive low-cost cross border remittances back to and from their home countries.
In addition, the linkage also provides an automatic incorporation of capital control rules for enhanced efficiency.
The launch of the PayNow-UPI linkage is a result of the extensive collaboration between MAS, RBI and India and Singapore’s payment system operators, payment scheme owners, and participating banks and non-bank financial institutions.
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