Local payments initiatives challenge dominance of card schemes

The payments industry is undergoing rapid modernisation to stay current with digitally transforming economies and address rising end-user expectations.

Customers are now asking for real-time payments for daily domestic and cross border payments, such as bill payments, or cross-border payments involving different currencies.

Despite ongoing efforts by payment regulators and industry bodies across geographies to achieve payments speed and transparency, consumers still perceive a lag in the real-time payments promise.

Instant payments are now an area of focus for payment regulators in the western markets, after gaining acceptance among consumers in APAC.

What’s the catalysts?

Regional initiatives are creating siloed blocs of payment systems as opposed to a globally compatible network.

The ASEAN interoperable QR ecosystem, expansion of Chinese firms toward quick response (QR) payments in overseas markets, India’s Unified Payments Interface (UPI), and others are catering to a regional cluster of adopters. And developed markets are following the trend.

The Unified Payments Interface (UPI), which is an instant payment system, is facilitating overseas merchant payments in several countries in addition to domestic account to account payments.

The US and European Union also support their regional initiatives: The envisioned IXB pilot service includes TCH’s real-time payments service in the US and EBA Clearing’s pan-European RT1 service.

The goal is predictable and fast cross-border payments in the EUR-USD corridor.

What Next?

Ongoing initiatives are in place to establish regional payment networks that connect countries within specific jurisdictions. Furthermore, there is a nascent effort to interconnect different regional networks facilitating linkage globally.

In 2021, Thailand’s PromptPay and Singapore’s PayNow real-time payment infrastructure were linked.

Customers of participating banks in Singapore and Thailand will be able to transfer funds of up to Singapore dollars 1,000 or THB 25,000 daily across the two countries, using just a mobile number.

In 2021, Singapore also connected its real-time payment infrastructure with Malaysia’s DuitNow. Singapore, Indonesia, Malaysia, the Philippines, and Thailand have all announced plans to integrate regional QR payment systems.

Countries like France, Singapore, the UK, the UAE, Nepal, and Japan have inked agreements for cross-border rupee payments through UPI. Monthly transaction volumes on the UPI network crossed 9.96 billion by July 2023.

The Bank for the International Settlements (BIS) built a network prototype, Nexus Gateway, to standardise the multilateral linking of IP systems. The pilot was conducted in 2021 to connect the systems of Europe (TIPS), Malaysia (DuitNow), and Singapore (PayNow).


As regional payment partnerships evolve, a common framework must develop to allow for compatibility between each of the regional payments networks. A globally compatible payments network allows businesses to trade with partners, suppliers, and customers across borders without dealing with complex payment processes.

In addition, businesses that can access global online payment processing can tap into new markets. Consumers now expect to be able to pay international merchants with ease, making it a competitive advantage.

A global payments system also enables efficient cross-border transactions in multiple international currencies.


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