SINGAPORE: Plans to open the Fast and Secure Transfers (FAST) transaction system in Singapore have been welcomed by industry experts and financial technology players (fintech), who said they are paving the way for more ease of use and more innovative e-business. payment services for consumers as they lend a hand to the cashless push of Singapore.
Minister of Education Ong Ye Kung said on Monday (September 17) that non-banking players will soon have direct access to FAST – the inter-bank instant electronic transfer system launched in 2014 and on which peer-to-peer service PayNow is built – so that their e-wallets can cooperate with bank accounts.
Put simply, this means that customers can quickly make instant-ups or refunds of different types of e-wallets on any bank account.
Apart from that, Mr Ong said that if we allow open access to a common infrastructure such as FAST, hopefully it will create added-value services if players compete.
Those with Channel NewsAsia expressed their support and some described it as an important & # 39; milestone that puts Singapore on the world map.
While similar initiatives are under way in countries such as the UK, opening FAST will still make it one of the first global payment platforms to enable interoperability between financial services providers outside of traditional banks, said Michael Yeo, Senior Research Manager from IDC Singapore.
For consumers, they can expect greater ease of use and ultimately, more choices when fintech companies use their products and services within FAST and embed them, he added.
Consumers can look forward in particular to more differentiated e-payment services, said mr. Jeremy Tan, founder and CEO of the Dutch payment technology company Liquid Group.
"While banks serve hundreds and thousands of customers at once, the fintech players tend to look at niche areas, which will create many more different payment services."
Meanwhile, a direct link to bank accounts can speed up the process of topping up e-wallets because users no longer have to "go the extra mile" to use methods such as credit cards. "I think this will only contribute to the acceptance of e-payments in Singapore," Mr. Tan added.
With this, Liquid Group has signed up to be part of the working group in the sector that will remove the necessary business and technical requirements for non-banks to connect directly with FAST.
Transfer company TransferWise, player for mobile payment technology, MatchMove, gaming company Razer and gifted giant Grab are among the others who have submitted their name.
The UK-based TransferWise said it can provide lessons because it was the first non-banking company to have access to the faster UK payment scheme earlier this year.
"It is crucial to ensure that the costs of participation, both technically and financially, are as low as possible, otherwise this valuable initiative will not achieve the intended goals", said the head of the banking system Lukas May.
Others think that the working group in the sector will have to deal with problems, varying from system compatibility to security and compliance.
"The ultimate goal of the working group is to find a balance between open accessibility, stability and access security, and efficient capital deployment for long-term sustainability and regulatory competitiveness," said Senior Ashley Koh, senior vice president of Matchmove. .
For Shirish Jain, director at the & # 39; Strategy && # 39; PwC's office, it's about finding a balance between convenience and the resilience of FAST.
"From a workgroup perspective it should be to strengthen FAST and ensure that it lowers the barriers to entry, adequately defines the security of the access points and prevents problems from being spread outside that participant."
THE RACE OF SINGAPORE TO GO CASHLESS
Although Singapore's striving for a moneyless society seems to have become more important as part of the Smart Nation umbrella in recent years, the country's e-payments journey began relatively early in 1984 with the Interbank Giro system.
This was followed by the introduction of the NETS service two years later, allowing consumers to use ATM cards linked to their bank accounts to pay merchants.
Following a series of initiatives to bring e-payments to the local public transport system, recent measures have led to more convenience for consumers and businesses and to improved interoperability.
These included the introduction of FAST in 2014 and the PayNow transfer service last year. Since then, 1.2 million mobile numbers and 550,000 NRIC numbers have been linked to bank accounts, with about S $ 1.5 billion transferred via PayNow.
Last month PayNow expanded to companies with the aim of reducing cash and handling checks.
In another move to unite the fragmented e-payment space here, the Singapore Quick Response Code (SGQR) – a single QR code that is compatible with as many as 27 e-payment solutions – was launched on Monday.
Mr. Jain described the QR code of the single payment as a "very important basic step": "It simplifies retail payments, helps to solve confusion and confusion for the consumer and trader."
He added: "Just as PayNow simplifies payments by phone number, SGQR should also help increase innovation in this space."
Accordingly, Mr. Yeo of IDC Singapore said that while consumers still have to check whether their preferred payment schedule is accepted by the merchant, having a single QR code sticker is still a "huge improvement" to the current situation of having multiple QR codes on displayed by some sellers.
All in all, experts think that Singapore is taking "positive steps" towards its goal of a moneyless society, although there are still problems.
First, there is still the perceived convenience, affordability and ubiquity of cash & # 39; in some segments of society, Mr. Jain said.
More needs to be done in terms of increasing acceptance of merchants and encouraging consumer acceptance, while ensuring that security concerns can be adequately addressed, said Mr Yeo.
Then Mr. Ong said in his speech on Monday that the regulations will be the "last piece of the e-payments jigsaw puzzle" for the government.
"All these efforts will be nullified if people do not feel safe using electronic payments," said the minister at the launch of the SGQR.
Incoming steps will enable, among other things, financial institutions to implement "robust" cyber-defense actions so that customers can have confidence in conducting online financial transactions, while at the end of this month the MAS will issue a series of user protection guidelines for e-payments. . .