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PM Modi stated at the inauguration of PayNow that digital transactions will surpass cash in India.

Prime Minister Narendra Modi voiced optimism on Tuesday that digital transactions will soon overtake cash, as the Unified Payments Interface (UPI) is becoming the country’s preferred payment method.

After the inauguration of cross-border connectivity between UPI and PayNow of Singapore, Modi stated that 74 billion transactions totaling over 126 trillion, or nearly 2 trillion Singapore dollars, were conducted over UPI in 2022.

“Many analysts estimate that digital wallet transactions would soon surpass cash transactions in India,” he said.

He stated that a vast number of UPI transactions demonstrate that this domestically developed payment system is highly secure.

During video conference, Modi and his Singaporean colleague Lee Hsien Loong saw the introduction of cross-border connectivity between UPI and PayNow of Singapore.

Governor of the Reserve Bank of India, Shaktikanta Das, and Managing Director of the Monetary Authority of Singapore, Ravi Menon, announced the facility via UPI-PayNow token transactions.

The Reserve Bank of India (RBI) said in a statement that the UPI-PayNow linkage will allow users of the two rapid payment systems in any nation to perform convenient, safe, immediate, and cost-effective cross-border money transfers using their respective mobile apps.

It is possible to transfer funds held in bank accounts or e-wallets to or from India using only the UPI-id, cellphone number, or Virtual Payment Address (VPA).

State Bank of India, Indian Overseas Bank, Indian Bank, and ICICI Bank will enable both inward and outgoing remittances, according to the announcement. Axis Bank and DBS India will facilitate inward remittances.

The service will be made available to Singaporean users via DBS-Singapore and Liquid Group (a non-bank financial institution). Over time, more banks will be added to the relationship.

Clients of the aforementioned participating banks can send money to Singapore using their mobile banking app or internet banking.

Each Indian user can initially send up to 60,000 per day (equivalent to around SGD 1,000). For the user’s convenience, the system shall dynamically calculate and show the amount in both currencies at the time of the transaction.

The UPI-PayNow link is the result of extensive collaboration between the Reserve Bank of India (RBI), the Monetary Authority of Singapore (MAS), and the Payment System Operators of both countries, namely NPCI International Payments Limited (NIPL) and Banking Computer Services Pte Ltd (BCS), as well as participating banks and non-bank financial institutions.

This interconnection corresponds with the G20’s financial inclusion aims of promoting faster, cheaper, and more transparent cross-border payments and will constitute a major milestone in the development of infrastructure for cross-border payments between India and Singapore, according to the statement.

India has become one of the most rapidly expanding environments for financial innovation.

The Prime Minister has placed a significant focus on ensuring that the benefits of UPI are not restricted to India alone, but extend to other nations as well.

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