• The RBI and the Monetary Authority of Singapore have announced a project to link their respective fast payment systems, Unified Payments Interface and PayNow. The linkage is targeted for operationalisation by July 2022.
• PayNow is the fast payment system of Singapore which enables peer-to-peer funds transfer service, available to retail customers through participating banks and Non-Bank Financial Institutions in Singapore.
• The UPI-PayNow linkage will enable users of each of the two fast payment systems to make instant, low-cost fund transfers on a reciprocal basis without a need to get onboarded onto the other payment system.
• The UPI-PayNow linkage is a significant milestone in the development of infrastructure for cross-border payments between India and Singapore, and closely aligns with the G20’s financial inclusion priorities of driving faster, cheaper and more transparent cross-border payments.
• Unified Payments Interface (UPI) is India’s mobile based, ‘fast payment’ system that facilitates customers to make round the clock payments instantly using a Virtual Payment Address created by the customer.
• This eliminates the risk of sharing bank account details by the remitter.
• UPI supports both Person to Person and Person to Merchant payments as also it enables a user to send or receive money.
• It was developed by the National Payments Corporation of India (NPCI), an RBI regulated entity.
How is it unique?
• Immediate money transfer through mobile device round the clock 24*7 and 365 days.
• Single mobile application for accessing different bank accounts.
• Single Click 2 Factor Authentication – Aligned with the Regulatory guidelines, yet provides for a very strong feature of seamless single click payment.
• Virtual address of the customer for Pull and Push provides for incremental security with the customer not required to enter the details such as Card no, Account number; IFSC etc.
Mains Paper 3: Economy
Prelims level: Unified Payments Interface
Mains level: Read the newsfeed