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Business News/ Politics / Policy/  UPI linked to Singapore’s PayNow for fast transfers
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UPI linked to Singapore’s PayNow for fast transfers

DBS Bank said that PayNow-UPI would be rolled out progressively to familiarize its customers with the new service

Prime Minister Narendra Modi at the launch of UPI-PayNow linkage on Tuesday (Photo: PIB)Premium
Prime Minister Narendra Modi at the launch of UPI-PayNow linkage on Tuesday (Photo: PIB)

MUMBAI : India and Singapore on Tuesday linked their quick payment systems, Unified Payments Interface (UPI) and PayNow, easing the process of fund transfers between individuals in the two Asian nations.

Initially, the UPI-PayNow link will feature only a handful of banks and can be used only for person-to-person transactions. Customers of State Bank of India, Indian Overseas Bank, Indian Bank and ICICI Bank will be able to both send and receive money, while those of Axis Bank and DBS India can only receive money in their accounts. More banks will be added over time.

“To begin with, an Indian user can remit up to 60,000 a day (equivalent to around SGD 1,000). At the time of making the transaction, the system shall dynamically calculate and display the amount in both currencies for the convenience of the user," the Reserve Bank of India said in a statement.

The transactions can only be made over the banks’ mobile app or internet banking. For users in Singapore, the service will be made available through DBS Singapore and the Liquid Group (a non-bank financial institution).

RBI governor Shaktikanta Das and Monetary Authority of Singapore managing director Ravi Menon initiated the UPI-PayNow linkage by making token transactions in a virtual event witnessed by Prime Minister Narendra Modi and his Singapore counterpart Lee Hsien Loong.

The plan to connect the payments systems was announced in September 2021 and was initially slated to be operationalized by July 2022.

DBS Bank said in a statement that PayNow-UPI would be progressively rolled out to familiarize its customers with the new service. Selected customers can use PayNow-UPI to transfer funds of up to SGD 200 per transaction, capped at SGD 500 per day, it said. By 31 March 2023, DBS Bank said, the service will be extended to all customers who can transfer funds of up to SGD 1,000 a day.

“With India being one of DBS’ biggest markets for overseas remittances, this is a welcome addition to our wide-ranging suite of payment solutions for SMEs, retail customers and especially migrant workers, who now have another convenient option to send money to their loved ones back home," said Shee Tse Koon, Singapore country head, DBS Bank.

According to RBI, the linkage resulted from a collaboration between RBI, the Monetary Authority of Singapore, and payment system operators of both countries, NPCI International Payments Ltd and Banking Computer Services Pte Ltd, along with participating banks and non-bank financial institutions.

India’s retail payments umbrella body NPCI has been attempting to take UPI overseas and recently allowed non-resident Indians to use UPI even if their domestic bank accounts are linked to their foreign mobile numbers.

“It will significantly benefit migrant workers, tourists, small businesses, and enterprises. This will also establish a significant foundation for cross-border payments between India and Asean countries," said Akash Sinha, chief executive and co-founder of Cashfree Payments.

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ABOUT THE AUTHOR
Shayan Ghosh
Shayan Ghosh is a national writer at Mint reporting on traditional banks and shadow banks. He has over a decade of experience in financial journalism. Based in Mint’s Mumbai bureau since 2018, he tracks interest rate movements and its impact on companies and the broader economy. His interests also include the distressed debt market, especially as India’s bankruptcy law attempts recoveries of billions worth of toxic assets.
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Published: 21 Feb 2023, 11:23 PM IST
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