Singapore and Malaysia combine faster payment systems
Fresh from a faster payment link with India, the Monetary Authority of Singapore has announced plans to start a phased linkage of the country’s PayNow plumbing with Malaysia’s DuitNow real-time payment systems.
The first phase of the PayNow-DuitNow link will be launched in the fourth quarter of 2022. This will allow clients of participating financial institutions to make real-time money transfers between Singapore and Malaysia using only a mobile phone number. Customers will also be able to make retail payments by scanning NETS or DuitNow QR codes displayed in merchant windows.
The project will allow smoother payments for the high volume of remittances between Singapore and Malaysia, which reached S $ 1.3 billion in 2020.
The Malaysian connection comes shortly after a similar connection with the Reserve Bank of India’s unified payment interface, allowing users to make instant and low-cost funds transfers on a reciprocal basis without the need for register on the other payment system.
In July, the Bank for International Settlements and the Monetary Authority of Singapore released a plan for multilateral linking of national real-time payment systems across borders.
Called Project Nexus, the model envisions the creation of âNexus gatewaysâ that serve to coordinate compliance, currency conversion, message translation and payment sequencing among all participants. It builds on the bilateral link between Singapore’s PayNow and Thailand’s PromptPay, launched in April 202
Future developments of the Malaysian partnership could include shared projects on distributed management technology and smart contracts, said Sopnendu Mohanty, chief financial officer of MAS.
âSingapore’s transfer corridor with Malaysia is our largest transfer corridor; therefore, the PayNow-DuitNow link will be an important infrastructure to meet the cross-border payment needs of individuals and businesses, as well as the growing digital economic activity between the two countries, âhe said. âThe link also provides MAS and BNM with a valuable opportunity to integrate the use of distributed ledger and smart contract technologies into the cross-border wholesale payments space.