Winners and losers of SG and India’s novel PayNow-UPI linkage

Fintech players new to the business of cross-border money transfers had much to cheer last month.

The Monetary Authority of Singapore (MAS) announced the new real-time payment linkage between Singapore’s PayNow, a peer-to-peer funds transfer service, and India’s United Payments Interface (UPI), the popular payment infrastructure developed by the country’s largest banks.

Launched in 2016, UPI is the most popular way in which Indians transact online. / Photo credit: PradeepGaurs / Shutterstock

Aimed at facilitating trade and people-to-people links between both countries, the linkage will benefit tourists as well as Indians living and working in Singapore who remit money back home regularly – and vice versa.

Every year, more than US$1 billion in payments and remittances flow between Singapore and India. Many users still rely on age-old services like telegraphic transfers, though platforms like Wise, Instarem, and Revolut – which offer more competitive and transparent rates – are also increasingly popular.

To seasoned fintech firms already in the business, the new linkage is little to shout about.

“Wise has been doing it for over a year already, where if you’re a customer in Singapore, you could just have the UPI ID of your recipient in India and send them money, and a customer in Singapore could receive money using their PayNow phone number,” Surendra Chaplot, Wise’s global head of product for cards, Wise Business, and Wise Platform, tells Tech in Asia.

It’s not necessarily a new thing in the industry.

Singapore customers of Wise can use PayNow to fund their accounts and receive money from Wise users internationally – not just in India. Customers sending money to India from anywhere in the world need only their recipient’s UPI ID – they wouldn’t have to fill in clunky bank account details.

In Singapore, Wise has direct access to the electronic funds transfer service FAST and connects to PayNow through a partner. The London-headquartered firm also facilitates low-cost and fast transfers through its network of banks across the world, Chaplot explains.

Photo credit: Wise

“It’s not necessarily a new thing in the industry,” he adds. “Yes, it’s a new thing for various players like DBS and other banks, but we’ve been doing this for quite some time.”

A game changer?

Access to the PayNow-UPI linkage will progressively roll out to more participants, though no further details have been released on when – and to whom – that might be.

The question of cost

“Not just a money transfer service”

Leveraging industry investments