THE STORY SO FAR: On February 21, India’s Unified Payments Interface (UPI) and Singapore’s PayNow were officially connected to allow for “real-time payment linkage”. Singapore is the first

country with which cross-border Person to Person (P2P) payment facilities have been launched. The plan was first announced by the Reserve Bank of India (RBI) and the Monetary Authority of

Singapore (MAS) in September 2021 to facilitate instant low-cost, cross-border fund transfer. HOW WILL IT HELP? When the scheme was announced, the RBI had said that the cross-border

interoperability of payments using cards and QR codes between India and Singapore would further anchor trade, travel, and remittance flows between the two countries. The initiative is a part

INTERFACE-PAYNOW LINK  On February 21, Prime Minister Narendra Modi and his counterpart, Singapore Prime Minister Lee Hsien Loong, attended the virtual launch. The Ministry of External

Affairs said this would help the Indian diaspora in Singapore, especially migrant workers, and students, and “bring the benefits of digitalisation and fintech to the common man through the

instantaneous and low-cost transfer of money from Singapore to India and vice-versa.” HOW WILL THE SCHEME WORK? Data | India’s shift from cheques to online money transfers faster than

Singapore, US and Canada For users at the Indian end, 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 only facilitate inward remittances for now. DBS-Singapore and Liquid Group, a fintech company, will facilitate the service for users in Singapore. More banks will be

included in the linkage with time, the RBI said in a press release. Account holders of listed banks can transfer funds to/from India using their UPI ID, mobile number, or Virtual Payment

Address (VPA). To begin with, Indian users can remit up to ₹60,000 per day. This is equal to around $ (Singapore) 1,000. Cross-border remittances to Singapore can be done through the bank’s

mobile application or internet banking facilities. Apps of participating Indian banks will have an opt in/opt out feature for receiving remittances from Singapore. Currently, only UPI IDs

registered with the same bank where an account is held can be used to receive remittances in accounts of participating banks. The P2P remittances between India and Singapore are only allowed

for purposes of “maintenance of relatives abroad” and “gifts”. According to the RBI, participating banks will roll out updates to allow global remittances in their UPI apps in a phased

manner. India has also considered allowing UPI remittances from other countries like the United Arab Emirates (UAE) which hosts a large Indian population. In November 2022, India and UAE

discussed allowing cross-border remittances through UPI platforms during a meeting between External Affairs Minister S. Jaishankar and UAE Foreign Minister Sheikh Abdullah bin Zayed Al

Nahyan in New Delhi. NRIs from 10 countries can use UPI with their international mobile numbers WHAT ARE REAL-TIME PAYMENTS (RTP)? As the name suggests, real-time payments are money

transfers that are mostly settled as soon as they are performed. RTPs are allowed 24x7, 365 days a year. They help simplify the process of fund transfer as well as ease communication between

the payer and the payee. P2P payments involve the transfer of funds from one user’s bank account to another through a digital medium. Common examples of P2P mobile apps in India include

GPay and Paytm. Using P2P payments eliminates the risk of sharing bank account details. In 2022, UPI payments worth ₹8,31,993.11 crore were recorded in January. This figure climbed to

₹12,81,970.86 crore in December. Published - February 26, 2023 01:04 am IST Read Comments Remove SEE ALL PRINT RELATED TOPICS banking / The Hindu Explains / India / Singapore