28 Sep - 2 min read
Bank Negara Malaysia (BNM) and the Monetary Authority of Singapore (MAS) have announced plans to link Malaysia’s DuitNow and Singapore’s PayNow real-time payment systems beginning in the fourth quarter of 2022 (4Q22).
Under Phase 1 of this linkage, customers of participating financial institutions will be allowed to make real-time fund transfers between Malaysia and Singapore using just a mobile number. Customers will also be able to make retail payments by scanning DuitNow or NETS QR codes displayed at merchants’ storefronts, according to a joint statement.
With the high volume of remittances between Malaysia and Singapore, which reached RM4.2 billion in 2020, the project will enable more seamless payments for a lot of people. This includes those who travel back and forth between the two countries regularly with pre-pandemic traffic recording about 12 million arrivals yearly on average.
Following the launch of Phase 1, BNM and MAS are expected to progressively expand the DuitNow-PayNow linkage to incorporate a wider range of innovative features and participants. These include distributed ledger technology-based solutions to catalyse greater efficiencies in payments clearing and settlement between participating banks.
“By bringing the efficiencies observed in domestic payments to cross-border payments, the DuitNow-PayNow 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 Malaysia and Singapore, it would also serve as a key enabler to support post-pandemic economic growth,” said the assistant governer of BNM, Fraziali Ismail.
Meanwhile, the chief fintech officer of MAS, Sopnendu Mohanty said that this move will further enhance close bilateral ties between Malaysia and Singapore. “For Singapore, the remittance corridor with Malaysia is our largest remittance corridor; hence, the DuitNow-PayNow linkage will be an important infrastructure to support cross-border payment needs of individuals and businesses, as well as the growing digital economic activity between both countries,” he stated.
For context, the DuitNow-PayNow linkage is not the only cross-border payment linkage that Malaysia has agreed to. Earlier this year, BNM had also worked with the Bank of Thailand (BOT) to enable a cross-border QR payment linkage between the two nations.
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