UPI–PayNow Linkage: India-Singapore’s Real-Time Payment Bridge

For UPSC Aspirants | By Suryavanshi IAS

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🔍 Why in News?

On July 17, 2025, NPCI International Payments Ltd (NIPL) will expand the UPI–PayNow real-time payment system by adding 13 new Indian banks, taking the total to 19, to facilitate instant cross-border remittances between India and Singapore.

This development builds on the RBI–Monetary Authority of Singapore (MAS) partnership, which aims to simplify, secure, and speed up individual-to-individual (P2P) and person-to-merchant (P2M) cross-border payments.

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💡 Key Terms for UPSC

Term	Meaning
UPI (Unified Payments Interface)	A real-time payment system developed by NPCI, allowing instant money transfers between bank accounts using mobile apps like BHIM, GPay, etc.
PayNow	Singapore’s real-time payment service enabling P2P transfers using mobile number or NRIC.
NPCI International (NIPL)	NPCI’s arm for expanding UPI-based infrastructure globally.
Cross-Border Remittance	Money sent by a person in one country to another person in a different country.
Virtual Payment Address (VPA)	A unique ID in UPI linked to a bank account, used for transactions (e.g., name@bank).

 India–Singapore Financial Connectivity: Key Highlights

🔸 Partnership Origin:

A joint initiative between the Reserve Bank of India (RBI) and Monetary Authority of Singapore (MAS) to enable instant fund transfers between residents of both countries.

🔸 Live Date of Expansion:

July 17, 2025

🔸 Total Indian Banks Enabled for Inward Remittances: 19

Includes:
SBI, ICICI, HDFC, Axis, PNB, Bank of Baroda, Indian Bank, Indian Overseas Bank, UCO, Kotak, and more.

🔸 Outward Remittance Enabled from India via:

• Canara Bank

• ICICI Bank

• HDFC Bank

• Indian Bank

• Indian Overseas Bank

• SBI

• Karur Vysya Bank

🔸 Singapore Participants:

• DBS Singapore

• Liquid Group

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💰 How It Works (UPI–PayNow Integration)

India Side	Singapore Side
Receive via UPI ID	Send via Mobile Number or VPA
Bank apps, GPay, PhonePe, BHIM	DBS SG, Liquid Group apps
Instant Remittance	Real-Time Settlement
Limits set by RBI	MAS monitors compliance

✅ Benefits for India

1. 🔗 Financial Inclusion

• Enables migrant workers, students, and expats to send/receive money instantly, reducing cost and time.

2. 📉 Reduced Reliance on Costly SWIFT Transfers

• Avoids traditional wire transfers that are slow, expensive, and less transparent.

3. 🌍 Boost to India’s Fintech Diplomacy

• Showcases UPI as a global public digital good, aligned with India’s G20 goals.

4. 💸 Remittance Security & Transparency

• Traceable, auditable, and real-time—protects from fraud and delays.

5. 📱 Digital Empowerment

• Integrates with widely used apps like PhonePe, Google Pay, BHIM—ensuring ease of use even for low-income users.

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🌏 Significance in Global Economy

India’s Global Digital Push	Example
UPI launched in UAE	PhonePe-NIPL Tie-up
UPI-RuPay acceptance in Bhutan	G2G initiative
MoU with France, UK & Japan	Future UPI rollouts
G20 Digital Public Infrastructure theme	UPI as model system

📚 UPSC Past Year Questions Related to This Topic

✅ GS Paper 2 – UPSC Mains 2022

Q. “Bilateral relations between India and Singapore have transformed significantly in the digital and financial sectors. Discuss with suitable examples.”

📌 Approach:

• Mention CECA, FinTech partnerships

• Highlight UPI–PayNow linkage

• Talk about data governance, remittance convenience

• Conclude with digital diplomacy

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✅ GS Paper 3 – UPSC Mains 2020

Q. “Fintech revolution is reshaping cross-border remittances. Comment.”

📌 Points to cover:

• Traditional vs fintech-based remittance models

• Cost, efficiency, trust

• Role of UPI–PayNow, blockchain, digital wallets

• Impact on foreign exchange management and diaspora welfare

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🔍 UPI–PayNow vs SWIFT: A Comparison

Parameter	UPI–PayNow	SWIFT
Speed	Real-time (seconds)	1–5 days
Cost	Low / negligible	High transaction fees
User Access	Mobile-based apps	Bank branch/online
Transparency	High	Limited
Suitability	P2P, micro-transactions	Large-scale corporate transfers

🧠 Mains Practice Question (GS II/III)

Q. How does the UPI–PayNow real-time payment linkage contribute to India’s vision of ‘Digital Financial Inclusion’? Evaluate its implications for India’s diaspora and FinTech diplomacy.

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📌 Key Takeaways for UPSC

• UPI is a cornerstone of India’s Digital Public Infrastructure (DPI)

• Its international expansion underlines India’s FinTech leadership

• Cross-border systems like UPI–PayNow are policy models for affordable, instant, inclusive remittances

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📊 Mind Map: UPI–PayNow and India’s Digital Diplomacy

            [UPI–PayNow Linkage]
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|              |             |                  |
[Cross-border] [Diaspora] [Fintech Export] [Ease of Doing Remittance]
  Remittances   Empowerment   to other nations      (real-time, secure)