UPI linked with Singapore’s Penau for faster transfers

Initially, the UPI-PayNow link will involve only a few banks and can only be used for person-to-person transactions. State Bank of India, Indian Overseas Bank, Indian Bank and ICICI Bank customers will be able to send and receive money, while Axis Bank and DBS India customers can only receive money in their accounts. More banks will be added over time.

“To start with, an Indian user can remit 60,000 per day (equivalent to approximately SGD 1,000). While doing the transaction, the system will dynamically calculate and display the amount in both the currencies for the convenience of the user, the Reserve Bank of India said in a statement.

The transaction can be done only on the mobile app of the banks or on internet banking. For users in Singapore, the service will be made available through DBS Singapore and Liquid Group (a non-bank financial institution).

Reserve Bank of India Governor Shaktikanta Das and Managing Director of the Monetary Authority of Singapore Ravi Menon launched the UPI-PayNow linkage by conducting token transactions at a virtual event witnessed by Prime Minister Narendra Modi and his Singaporean counterpart Lee Hsien Loong.

The plan to link the payment systems was announced in September 2021 and was initially planned to be operational by July 2022.

DBS Bank said in a statement that PayNow-UPI will be rolled out gradually to familiarize its customers with the new service. Select customers can use PayNow-UPI to transfer funds up to SGD 200 per transaction, with a limit of SGD 500 per day. By March 31, 2023, DBS Bank said, the service will be extended to all customers who can transfer funds of up to 1,000 Singapore dollars a day.

“With India being one of DBS’ largest markets for foreign remittances, it is a welcome addition to our comprehensive suite of payment solutions for SMEs, retail customers and especially migrant workers, who now have the option to send money to their loved ones. There is another convenient option. People are back home,” said Shi Tse Koon, Singapore Country Head, DBS Bank.

The deal resulted in a collaboration between the RBI, the Monetary Authority of Singapore and the two countries’ payment system operators, NPCI International Payments Ltd and Banking Computer Services Pte Ltd, as well as participating banks and non-bank financial institutions, according to RBI.

India’s retail payments umbrella body NPCI is attempting to take UPI overseas and recently allowed NRIs to use UPI even if their domestic bank accounts are linked to their overseas mobile numbers.

“This will greatly benefit migrant workers, tourists, small businesses and enterprises. It will also establish an important foundation for cross-border payments between India and ASEAN countries, said Akash Sinha, chief executive and co-founder of Cashfree Payments.