Vietnam’s central bank, the State Bank of Vietnam (SBV), has officially joined the Regional Payment Connectivity (RPC) initiative, a scheme initiated by central banks in Southeast Asia to strengthen and enhance collaboration on payment connectivity.
SBV officially signed the supplemental Memorandum of Understanding on Cooperation in RPC (MOU RPC) at the sidelines of the 10th Association of Southeast Asian Nations (ASEAN) Finance Ministers’ and Central Bank Governors’ Meeting in Jakarta, Indonesia.
SBV now joins Bank Indonesia, Bank Negara Malaysia, Bangko Sentral ng Pilipinas, Monetary Authority of Singapore, and Bank of Thailand in the initiative, which encompasses several modalities, including QR-code and fast-payment based cross-border payments.
The six central banks have a mandate to include other ASEAN members in the RPC initiative from the ninth finance ministers’ and central bank governors’ meetings.
The central bank of Brunei Darussalam is expected to also sign up for the RPC. The initiative may also be expanded to neighboring economies and countries beyond Southeast Asia.
In a statement, the RPC members said the partnership seeks to further support post-pandemic economic activities across the region to benefit small- and medium-sized enterprises, which are crucial to Southeast Asia’s economic growth.
The RPC also allows member states to increase trade and remittances within the region by connecting their payment systems. Additionally, the initiative is expected to widen financial inclusion and significantly contribute to the overall advancement of the ASEAN economic community.
“The MOU shows our solidarity and marks a good starting point for cooperation to strengthen regional economic integration and advance payment connectivity toward making ASEAN a global leader in payments connectivity,” said SBV Deputy Governor Pham Thanh Ha.
Among others, the RPC program allows residents to pay for goods and services in local currencies using a QR code. Analysts said this will boost tourism, consumer spending, and remittance flows in the region.
Regional connectivity also reduces ASEAN’s reliance on external currencies like the U.S. dollar for cross-border transactions, particularly among businesses.
In March, the Monetary Authority of Singapore and Bank Negara Malaysia launched a cross-border QR code payment linkage between Singapore and Malaysia, allowing customers of participating financial institutions to make retail payments by scanning NETS QR and DuitNow QR codes.
In the next phase, MAS and BNM plan to expand the payment linkage to enable cross-border account-to-account fund transfers and remittances.