The Monetary Authority of Singapore (MAS), the nation’s reserve bank and financial regulator, has revealed that eligible non-bank financial institutions (NFIs) will be able to gain direct access to the banking system’s retail payments infrastructure starting from February of next year.
NFIs that are authorized to serve as major payment institutions under Singapore’s Payment Services Act will have the option to link directly to Fast and Secure Transfers (FAST) and PayNow.
Direct connection to FAST and PayNow will allow users of NFI digital wallets to perform real-time money transfers between different bank accounts and online wallets as well as across different e-wallets. At present, most digital wallets have to get funded with debit or credit cards and you can’t transfer money (directly) between e-wallets.
Businesses that work with the 23 FAST or 9 PayNow banks, or digital wallets that have been “closed-loop” ecosystems will have the option to accept real-time payments from other e-wallet users or mobile banking apps that will be joining FAST or PayNow. This should allow companies or businesses to gain access to more consumers for receiving electronic payments “instantly” and seamlessly, the MAS noted.
NFIs may connect directly via the new API payment gateway created by the Direct FAST Working Group (DFWG), with assistance from the Singapore Clearing House Association (SCHA) and The Association of Banks in Singapore (ABS), which govern FAST and PayNow respectively. The API payment gateway is “better geared to the technology architecture of banks and NFIs, and can also be used by other banks and NFIs in future,” the MAS explained.
Ravi Menon, MD at MAS, stated:
“Direct access by NFIs to FAST and PayNow closes the last-mile gap in Singapore’s e-payments journey. Consumers who may not have ready access to debit or credit cards to fund their e-wallets will now have the option to do so directly through their bank accounts. Our vision to enable complete real-time payments interoperability will now become a reality. Adoption of e-payments will become even more simple for individuals and businesses.”
Lawrence Chan, Chairman of Banking Computer Services Pte Ltd (BCS), remarked:
“Since our inception, BCS has worked closely with the financial industry to spearhead large-scale, national payment projects that have enhanced the industry’s service offerings in Singapore. The successful launch of the API payment gateway is a significant milestone for FAST and PayNow, which are the foundation of instantaneous, open and accessible payments. As the operator of FAST and PayNow, we are proud to be part of this ongoing progress of Singapore’s real-time payments infrastructure that will serve as both a catalyst and an enabler for innovative e-payments.”
Ong Ai-Boon, Director of ABS, noted:
“This is the first time the industry has opened access to these two important e-payment platforms to non-banks. …FAST and PayNow adoption rates have exceeded expectations and we are confident that the addition of new players will help accelerate the national path towards a less-cash economy.”