21 Jun - 3 min read
Merchants and consumers in Malaysia and Thailand will be able to make and receive instant cross-border QR code payments between each other, thereby increasing regional connectivity, financial integration, and consumer convenience. This came following a move by Bank Negara Malaysia (BNM) and the Bank of Thailand (BOT) to enable a cross-border QR payment linkage between the two nations.
According to a statement by BNM, the project to introduce the payment linkage between both nations had actually begun back in June 2020, and is expected to be implemented in a total of three phases. “Today (18 June 2021) marks the completion of the first phase in linking the real-time retail payment systems of DuitNow in Malaysia and PromptPay in Thailand,” said the central bank.
With this latest update, users in Thailand will now be able to make payments to Malaysian merchants by scanning DuitNow QR codes with their mobile payment apps. This includes cross-border e-commerce transactions.
The second phase of this project, meanwhile, will allow users in Malaysia to use their mobile payment apps to scan PromptPay QR codes to make payments to merchants in Thailand. This is expected to take place in the fourth quarter of 2021 (4Q21).
Finally, phase three is slated to go live almost a year after that – in the fourth quarter of 2022. In this final phase, the linkage will be expanded to offer cross-border remittances, allowing users in both nations to make real-time fund transfers by keying in information such as the mobile phone numbers of the recipient.
At present, two banks from both countries have signed up to participate in the linkage, namely CIMB Thai Bank and Public Bank Berhad. They have started offering the instant cross-border QR code payment service to their customers. More financial institutions are expected to come onboard soon to broaden the network of users and merchants.
Both BNM and BOT agreed that the retail payment linkage will greatly support post-pandemic economic recovery as well as strengthen economic ties between both countries. They also said that it represents a key milestone in the ASEAN Payment Connectivity initiative. Briefly, the ASEAN Payment Connectivity initiative was initiated in 2019, involving eight ASEAN countries in total. It aims to reduce transaction fees for consumers, as well as promote financial integration between the involved countries.
The deputy governor of BNM, Datuk Abdul Rasheed Ghaffour further chimed in to state that the retail payment linkage will provide users with a faster, cheaper, and more inclusive payment arrangement. “It will give more options for consumers and merchants in the cross-border payment space and serve as a key enabler to strengthen regional connectivity and financial integration,” he said.
Meanwhile, the deputy governor of BOT, Ronadol Numnonda noted the significance of such cross-border payment system linkages, and said that BOT has continuously pursued such initiatives. “This connectivity builds on our domestic payment infrastructure which will facilitate cross-border retail payment activities between the two countries during and after the pandemic. More importantly, it will also facilitate the cross-border trade and e-commerce, thus contributing to economic growth and digitalisation,” he said.
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