Bank Negara Malaysia (BNM) and the Monetary Authority of Singapore (MAS) announced on Monday the plans to commence a phased linkage of Malaysia’s “DuitNow” and Singapore’s “PayNow” real-time payment systems.
The first phase of the DuitNow-PayNow linkage will be launched in the fourth quarter of 2022 and will allow customers of participating financial institutions to make real-time fund transfers between Malaysia and Singapore using just a mobile number, the central banks said in a joint statement.
Customers will also be able to make retail payments by scanning DuitNow or NETS QR codes displayed at merchants’ storefronts. The project will enable more seamless payments for the high volume of remittances between Malaysia and Singapore, which reached 4.2 billion MYR ($1 billion) in 2020. It will also cater to travelers between both countries, which saw sizeable pre-pandemic traffic of about 12 million arrivals yearly on average.
“By bringing the efficiencies observed in domestic payments to cross-border payments, the DuitNow-PayNow linkage will be a game-changer resulting in faster, cheaper, and more accessible payment services for the people of both countries. Not only would this initiative further strengthen the economic ties between Malaysia and Singapore, it would also serve as a key enabler to support post-pandemic economic growth,” Fraziali Ismail, the Assistant Governor of BNM said.
Following the launch, BNM and MAS will progressively expand the DuitNow-PayNow linkage to incorporate a wider range of features and participants.
Both regulators will also explore the feasibility of integrating innovative features such as distributed ledger technology-based solutions to catalyze greater efficiencies in payments clearing and settlement between participating banks.
The DuitNow-PayNow linkage represents another significant milestone in the history of close ties between Malaysia and Singapore. The linkage closely aligns with the G20’s work of driving faster, cheaper, more inclusive, and more transparent cross-border payments, and is a concrete step towards achieving an ASEAN network of linked real-time payment systems.
“For Singapore, the remittance corridor with Malaysia is our largest remittance corridor; hence, the DuitNow-PayNow linkage will be an important infrastructure to support cross-border payment needs of individuals and businesses, as well as the growing digital economic activity between both countries. This will further enhance close bilateral ties,” MAS Chief FinTech Officer Sopnendu Mohanty said.