Narendra Modi reiterated his belief that cash will soon be replaced by digital transactions as the country’s preferred payment method, the UPI, gains popularity. At the opening of the cross-border connection between the UPI and PayNow of Singapore, Modi stated that in 2022, UPI will be used in 74 billion transactions worth more than 126 trillion, or almost 2 trillion Singapore dollars.
India’s digital transactions to overtake cash
Modi and Lee Hsien Loong, the prime minister of Singapore, participated in a video conference to witness the beginning of cross-border connectivity between Singapore’s PayNow and the UPI. Governor of the Reserve Bank of India, Shaktikanta Das, and Managing Director of the Monetary Authority of Singapore, Ravi Menon, inaugurated the facility through token transactions using the UPI-PayNow connection.
Modi emphasized that the integration of UPI and PayNow marks a new high point in India-Singapore relations and will make it easier for citizens of both nations to conduct affordable cross-border transactions using mobile phones. According to him, Singapore is the first nation with which a cross-border P2P payment facility has been launched. This will benefit the Indian diaspora in Singapore, particularly migrant workers, and students, and bring the advantages of digitalization and fintech to the general public through instantaneous and inexpensive money transfers or transactions from India to Singapore and vice versa.
The delivery of public services and the government has undergone substantial modifications thanks to the Digital India program. The integration will allow customers of the two quick payment systems in each nation to send money across borders quickly, securely, and affordably using their own mobile applications. According to a statement from the RBI, money stored in bank accounts or e-wallets can be moved to or from India using only a UPI-id, cellphone number, or VPA.
First off, according to the announcement, both inbound and outbound remittances will be facilitated by the State Bank of India, Indian Overseas Bank, Indian Bank, and ICICI Bank. Users in Singapore can access the service thanks to DBS-Singapore and Liquid Group. The linking will eventually involve more banks. Clients of the aforementioned participating banks can send money across borders to Singapore by utilizing the bank’s internet banking or mobile banking app. An Indian user can initially send up to ₹60,000 in a single day. The system must dynamically calculate and show the amount in both currencies at the moment of the transaction for the user’s convenience, it stated.
The RBI, Singapore’s Monetary Authority, NPCI International Payments Limited, Banking Computer Services, and partner banks and non-bank financial institutions worked closely together to create the UPI-PayNow linkage. This interlinkage supports the G20’s financial inclusion priorities of promoting quicker, less expensive, and more open cross-border payments and will mark an important turning point in the establishment of cross-border payment infrastructure between India and Singapore, according to the statement.
One of India’s financial innovation ecosystems has grown the fastest. The benefits of UPI should be shared with other countries in addition to India, the Prime Minister has stated. The 2 prime ministers spoke on the phone before to the virtual launch to discuss topics of interest to both parties. Prime Minister Modi praised Prime Minister Lee for helping advance relations between Singapore and India and expressed interest in cooperating with him during India’s G20 Presidency.