Prime Minister Narendra Modi on Tuesday expressed the hope that mobile payments will early surpass cash with Unified Payments Interface (UPI) increasingly being the most preferred payment system in the country.
Modi after the launch of the cross-border connectivity between the UPI and PayNow of Singapore said about 74 billion transactions amounting to more than Rs 126 trillion, which is approximately 2 trillion Singapore dollar, was done through UPI in 2022.
“Many experts are estimating that very soon India’s digital wallet transactions are going to overtake cash transactions,” he said.
A large number of transactions via UPI demonstrate that this indigenously designed payment system is very secure, he said. Modi along with his Singaporean counterpart Lee Hsien Loong witnessed the launch of cross-border connectivity between the UPI and PayNow of Singapore via video conferencing.
The facility was launched through token transactions by Reserve Bank of India Governor Shaktikanta Das and Managing Director of Monetary Authority of Singapore Ravi Menon using the UPI-PayNow linkage.
Stressing that the linkage of UPI and PayNow is a new milestone in India-Singapore relations, Modi said, this will help people of both the countries to do cross border transactions through mobile phones in an affordable manner.
Singapore is the first country with which a cross-border Person-to-Person (P2P) payment facility has been launched, he said, adding, this will help the Indian diaspora in Singapore, especially migrant workers/students, and bring the benefits of digitalization and fintech to the common man through instantaneous and low-cost transfer of money from Singapore to India and vice-versa.
Pointing out that the focus of the government is to promote innovation and modernization, Modi said the Digital India program of the government has enhanced ‘Ease of Living’ and ‘Ease of Doing Business’ and digital connectivity and has pushed financial inclusion. The Digital India program has brought in significant reforms in governance and public service delivery.
The linkage will enable users of the two fast payment systems in either country to make convenient, safe, instant, and cost-effective cross-border fund transfers using their respective mobile apps.
Funds held in bank accounts or e-wallets can be transferred to or from India using just the UPI-id, mobile number, or Virtual Payment Address (VPA), the Reserve Bank of India (RBI) said in a statement.
To begin with, the statement said State Bank of India, Indian Overseas Bank, Indian Bank, and ICICI Bank will facilitate both inward and outward remittances, while Axis Bank and DBS India will facilitate inward remittances.
For Singapore users, the service will be made available through DBS-Singapore and Liquid Group (a non-bank financial institution). More banks will be included in the linkage over time.
Customers of the above participating banks can undertake cross-border remittances to Singapore using the bank’s mobile banking app or internet banking.
To begin with, an Indian user can remit up to Rs 60,000 in 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, it said.
The UPI-PayNow linkage is the product of extensive collaboration between the RBI, Monetary Authority of Singapore (MAS), and Payment System Operators of both countries viz. NPCI International Payments Limited (NIPL) and Banking Computer Services Pte Ltd (BCS), and participating banks / non-bank financial institutions.
This interlinkage aligns with the G20’s financial inclusion priorities of driving faster, cheaper and more transparent cross-border payments and will be a significant milestone in the development of infrastructure for cross-border payments between India and Singapore, the statement said.
India has emerged as one of the fastest-growing ecosystems for fintech innovation. The virtual launch was preceded by a phone call between the two Prime Ministers, wherein discussions were held on areas of mutual interest. Prime Minister Modi thanked Prime Minister Lee for his partnership in taking the India-Singapore relationship forward and looked forward to working with him under India’s G20 Presidency.