In September 2021, both, India and Singapore initiated a project to link the fast payment systems in their respective countries viz. Unified Payments Interface (UPI) and PayNow. After almost two years since initiation, on February 21, 2023, both the countries announced the UPI and PayNow Integration that will transform the way both countries make cross-border fund transfers.
The UPI and PayNow linkage making transactions easier between India and Singapore was launched on February 21, 2023, under the presence of the Prime Minister of India, Narendra Modi and his counterpart in Singapore, Mr Lee Hsien Loong. This integration was announced by the Governor of the Reserve Bank of India (RBI), Shaktikanta Das and the Managing Director of the Monetary Authority of Singapore (MAS), Ravi Menon.
This cross-border fund transfer facility was launched through token transactions performed at the launch event by Shaktikanta Das and Ravi Menon.
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What Does The UPI-PayNow Linkage Do?
According to a press release shared by the RBI, this integration between UPI and PayNow will enable users of the two fast payment systems in both India and Singapore, to make convenient, safe, instant, and cost-effective cross-border fund transfers using their respective mobile apps.
This means you can use your existing banking/UPI app in India to send money to someone in Singapore instantly and at lower costs. You can also receive money in the same manner, that is as long as your bank/financial institution in your respective country is an active participating bank offering remittances under this new facility.
Who Will Benefit From The UPI-PayNow Integration?
People living in both countries, especially migrant diasporas of either country would be benefiting the most from this facility. Indian immigrants, students, workers, etc. living in Singapore can send and receive money from their relatives. Similarly, Singapore citizens living in India or travelling to India can also send and receive money from back home without any hassle.
However, currently, only account-holders of the participating banks and financial institutions in India and Singapore can do the cross-border remittance transactions through the UPI-PayNow linkage.
How To Transfer Funds With The UPI-PayNow Linkage?
Transferring funds via this new facility offered after the UPI-PayNow linkage is quite easy. Once your bank rolls out an update on your existing banking/UPI app, you can perform your transactions under this facility.
In India, UPI facilitates safe and instant remittances within the country, and in Singapore, PayNow does the same. With the new interlinkage, you can now send/receive money to/from Singapore using the same method. You can transfer your funds held in bank accounts or e-wallets to/from India using just the UPI-id, mobile number, or Virtual Payment Address (VPA).
However, currently, there is a daily transaction limit of ₹60,000 per day which is equivalent to around SGD 1,000 for undertaking cross-border remittance transactions through the UPI-PayNow linkage. After this linkage, your UPI/banking app's system shall dynamically calculate and display the amount in both the currencies for your convenience.
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Which Are The Participating Banks?
At the moment, six banks from India, namely, the State Bank of India, Indian Overseas Bank, Indian Bank, ICICI Bank, Axis Bank, and DBS India are participating in this facility. While the State Bank of India, Indian Overseas Bank, Indian Bank and ICICI Bank will facilitate both inward and outward remittances between India and Singapore, Axis Bank and DBS India will only facilitate inward remittances from Singapore.
In Singapore, users will be able to benefit from this facility via DBS-Singapore and Liquid Group which is a non-bank financial institution. However, more banks and financial institutions will be included from both ends over time.
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