BERNAMA – Southeast Asia and the wider Asia-Pacific region are driving a wave of innovation in digital payments that will enhance consumer accessibility and financial inclusion region-wide for the further convenience of consumers.
The fast-growing economies in the region are doing this by embracing a multimodal approach where new advancements integrate with established systems to achieve these objectives, said the group Chief Executive Officer of financial technology start-up BigPay, Zubin Rada Krishnan.
The innovative advancement would increase consumerism and, in the process, boost regional economies, he said yesterday during a panel session on ‘Defining the New Commerce across Borders: Cross-Border Payments and How it Benefits the Local and Regional Economy’ at the Singapore FinTech Festival 2024.
Zubin said that the industry has seen significant innovation over the past five to 10 years, primarily focused on payment ‘rails’.
Payment rails are the underlying infrastructure and systems facilitating funds transfer between parties, such as individuals, businesses and financial institutions.
Citing Malaysia, he said its long-established payment infrastructure has supported jobs for decades, forming the foundation for these new advancements.
“Building on this, real-time bank-to-bank payment rails were introduced as early as 2011.
“Following that, around 2013 and 2014, closed-loop rails emerged with e-wallets, led by services like Touch ‘n Go and Boost,” he said.
In recent years, Zubin said Malaysia has seen the development of DuitNow quick response (QR), an open-loop QR payment rail, along with the entry of major players like Alipay, further connecting payment rails across the region.
He added that supranational schemes are increasingly entering markets like Malaysia, reinforcing these connections.
“There are now bilateral arrangements between the Singaporean and Malaysian governments that allow Malaysian users to make QR code payments in Singapore,” he said.
Zubin said projects like Project Nexus drive global innovation by integrating domestic real-time payment rails internationally.
Project Nexus, a collaboration between the Bank for International Settlements (BIS) Innovation Hub and central banks from India, Malaysia, the Philippines, Singapore, and Thailand, is designed to enhance cross-border payment efficiency by linking various domestic instant payment systems globally.
While instant money transfers are already a reality in many markets, Zubin said that the next wave of innovation will focus on simplifying the user experience, the ‘train stations’ of the payment ecosystem.
“However, the current challenge, especially for business-to-consumer players, is to streamline these interactions so consumers can easily navigate and utilise various systems,” he said.
To achieve this, Zubin added that innovations in biometrics, wearables, and tokenisation are being explored, all aimed at enhancing the overall customer journey and making digital payments more intuitive and accessible.
