Prime Minister Narendra Modi on Tuesday expressed hope that digital transactions will soon surpass cash, as Unified Payments Interface (UPI) is increasingly becoming the most preferred payment mechanism in the country.
Modi after the launch of the cross-border connectivity between the UPI and PayNow of Singapore said about 74 billion transactions amounting to more than Rs. 1,26,00,000 crore, which is approximately SGD 2 trillion, was done through UPI in 2022.
"Many experts are estimating that very soon India's digital wallet transactions are going to overtake cash transactions," he said.
A large number of transactions via UPI demonstrate that this indigenously designed payment system is very secure, he said.
Modi along with his Singaporean counterpart Lee Hsien Loong witnessed the launch of cross-border connectivity between the UPI and PayNow of Singapore via video conferencing.
The facility was launched through token transactions by Reserve Bank of India Governor, Shaktikanta Das and Managing Director of Monetary Authority of Singapore Ravi Menon using the UPI-PayNow linkage.
The UPI-PayNow linkage will enable users of the two fast payment systems in either country to make convenient, safe, instant, and cost-effective cross-border funds transfer using their respective mobile apps, the Reserve Bank of India (RBI) said in a statement.
Funds held in bank accounts or e-wallets can be transferred to or from India using just the UPI-id, mobile number, or Virtual Payment Address (VPA), it said.
To begin with, the statement said State Bank of India, Indian Overseas Bank, Indian Bank, and ICICI Bank will facilitate both inward and outward remittances, while Axis Bank and DBS India will facilitate inward remittances.
For Singapore users, the service will be made available through DBS-Singapore and Liquid Group (a non-bank financial institution). More banks will be included in the linkage over time.
Customers of the above-participating banks can undertake cross-border remittances to Singapore using the bank's mobile banking app or internet banking.
To begin with, an Indian user can remit up to Rs. 60,000 in a day (equivalent to around SGD 1,000). At the time of making the transaction, the system shall dynamically calculate and display the amount in both currencies for the convenience of the user, it said.
The UPI-PayNow linkage is the product of extensive collaboration between the RBI, Monetary Authority of Singapore (MAS), and Payment System Operators of both countries viz. NPCI International Payments Limited (NIPL) and Banking Computer Services Pte Ltd (BCS), and participating banks / non-bank financial institutions.
This interlinkage aligns with the G20's financial inclusion priorities of driving faster, cheaper and more transparent cross-border payments and will be a significant milestone in the development of infrastructure for cross-border payments between India and Singapore, the statement said.
India has emerged as one of the fastest-growing ecosystems for fintech innovation.
A key emphasis of the Prime Minister has been on ensuring that the benefits of UPI are not limited to India only but extend to other countries as well.
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