Soon two people will be able to send money between Singapore and Malaysia using just their cell phone number.
In order to come onto the market in stages in the fourth quarter of next year, the real-time payment systems PayNow from Singapore and DuitNow from Malaysia will be linked.
Customers can also make payments by scanning the NETS or DuitNow QR codes in retail stores and restaurants, the central banks of Singapore and Malaysia announced in a joint statement today.
This could facilitate an increase in cross-border remittances and is a sign of both countries’ commitment to boost tourism spending when that comes back into play in the near future.
Image source: HSBC
“The project will enable smoother payments for the high volume of remittances between Singapore and Malaysia, which reached US $ 1.3 billion in 2020. It will also serve travelers between the two countries, which prior to the pandemic had significant traffic of around 12 million arrivals per year. “On average,” both central banks said in the joint statement.
“Singapore’s remittance corridor with Malaysia is our largest remittance corridor; Therefore, the PayNow-DuitNow connection will be an important infrastructure to support the cross-border payment needs of individuals and companies as well as the growing digital economic activity between the two countries, “added Sopnendu Mohanty, Chief FinTech Officer of the Central Bank of Singapore.
Further functions in the works
Once launched, the Monetary Authority of Singapore and Bank Negara Malaysia will gradually expand the PayNow-DuitNow connection to incorporate a wider range of functions and participants.
Both regulators will also explore the possibility of integrating innovative features such as solutions based on distributed ledger technology to achieve greater efficiency in clearing and processing payments between participating banks.
Image source: Sojacincau
The link between PayNow and DuitNow marks another significant milestone in the history of the close ties between Singapore and Malaysia, central banks said.
The link is closely related to the work of the Group of 20 to drive faster, cheaper, more inclusive and more transparent cross-border payments and is a concrete step on the way to an ASEAN network of linked real-time payment systems.
In mid-September, the central bank of Singapore announced that it would establish a connection to India’s single payment interface by July 2022. Previously, in April, the Central Bank of Singapore announced that it would link PayNow with Thai PromptPay.
Highlighted image source: BNS, Pile