Singapore’s PayNow and Malaysia’s DuitNow will be linked in phases from the fourth quarter of 2022, allowing customers of participating financial institutions to make real-time funds transfers between the two countries using mobile numbers.
Customers will also be able to make retail payments by scanning NETS or DuitNow QR codes displayed at storefronts, the Monetary Authority of Singapore (MAS) and Bank Negara Malaysia (BNM) said in a joint media release on Monday (Sep 27).
“The project will enable more seamless payments for the high volume of remittances between Singapore and Malaysia, which reached S$1.3 billion in 2020,” the central banks said.
“It will also cater to travellers between both countries which saw sizeable pre-pandemic traffic of about 12 million arrivals yearly on average.”
Following the launch, the PayNow-DuitNow link will be progressively expanded to offer more features and include more participants.
MAS and BNM will also “explore the feasibility of integrating innovative features such as distributed ledger technology-based solutions to catalyse greater efficiencies in payments clearing and settlement between participating banks”.
“The PayNow-DuitNow linkage represents another significant milestone in the history of close ties between Singapore and Malaysia,” said MAS and BNM.
“The linkage closely aligns with the G20’s work of driving faster, cheaper, more inclusive and more transparent cross border payments, and is a concrete step towards achieving an ASEAN network of linked real-time payment systems.”
Sopnendu Mohanty, chief fintech officer of MAS, described the link as “important infrastructure” to support cross border payment needs of individuals and businesses.
It will also support the “growing digital economic activity” between Singapore and Malaysia, he added.
“The linkage also offers MAS and BNM a valuable opportunity to incorporate the use of distributed ledger and smart contract technologies in the wholesale cross-border payments space,” he said.
Fraziali Ismail, assistant governor of BNM, said: “By bringing the efficiencies observed in domestic payments to cross-border payments, the PayNow-DuitNow linkage will be a game-changer resulting in faster, cheaper and more accessible payment services for the people of both countries.
“Not only would this initiative further strengthen the economic ties between Singapore and Malaysia, it would also serve as a key enabler to support post-pandemic economic growth.”
Earlier this month, MAS and the Reserve Bank of India announced that PayNow would be linked with India’s Unified Payments Interface (UPI) by July 2022.
In April, PayNow and Thailand’s PromptPay were also linked.