India’s Unified Payments Interface — better known as UPI — and Singapore’s PayNow were officially connected on Tuesday, allow for a “real-time payment linkage”. The virtual launch was led by a phone call between Prime Minister Narendra Modi and his Singaporean counterpart Lee Hsien Loong.
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“Today is a special day for India-Singapore friendship and for our efforts to deepen collaboration in FinTech and innovaton. The participation of my friend PM Lee Sien Loong made this morning’s programme even more special,” Mr. Modi said. The linkage is set to ease financial transactions for the Indian diaspora.
Singapore has now became the first country with which cross-border Person to Person (P2P) payment facilities have been launched. “This will help the Indian diaspora in Singapore, especially migrant workers/students and bring the benefits of digitalisation and FINTECH to the common man through instantaneous and low-cost transfer of money from Singapore to India and vice-versa,” said the Ministry of External Affairs. UPI payments through QR codes are already taking place in Singapore, though at a limited number of outlets.
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“Delighted to launch the linkage between PayNow and India’s Unified Payments Interface (UPI) with PM Narendra Modi today. Congratulations to the Monetary Authority of Singapore, the Reserve Bank of India and all the stakeholders in Singapore and India who have helped make the linkage a reality,” Lee Hsien Loong said at the event.
Demonstrating the link, the Reserve Bank of India’s Governor Shaktikanta Das and the Monetary Authority of Singapore’s Managing Director Ravi Menon made live “cross-border transactions” to each other using their mobile handsets.
Mr. Modi noted about 74 billion transactions amounting to more than ₹126 trillion (approximately 2 trillion Singapore dollars) were done through UPI in 2022, hinting at the reliability and security of the platform that is cultivating trust among users.
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“Many experts are estimating that very soon India’s digital wallet transactions are going to overtake cash transactions,” he said.
“A key emphasis of the Prime Minister has been on ensuring that the benefits of UPI are not limited to India only, but other countries too benefit from it,” the statement said. It added that India under the helm of PM Modi has emerged as one of the fastest-growing ecosystems for fintech innovation, and will help drive globalisation of India’s “best-in-class digital payment infrastructure”.
The UPI-based payment ecosystem has witnessed significant attention recently. In January, the National Payments Corporation of India (NPCI) enabled international (phone) numbers to be able to transact using UPI. Later, the Union Cabinet chaired by PM Modi approved incentivisation schemes for promoting low-value BHIM-UPI transactions in FY 2022-23.
In February this year, PhonePe, launched support for the “UPI international” payments, allowing Indian users travelling abroad to pay foreign merchants using UPI.
In the third quarter of 2022, India recorded over 23.06 billion digital payments -- including UPI, debit and credit cards -- worth ₹38.3 lakh crore. Out of these, UPI-based transactions amounted to ₹32.5 lakh crore in value.