Beyond UPI: Faster payment systems other countries are experimenting with
India’s Unified Payments Interface (UPI) is wining plaudits across the globe for revolutionising faster payments. The G20 Global Partnership for Financial Inclusion document prepared by World Bank has lauded transformative impact of digital public infrastructure – a model on which UPI payment system is based — in India over the past decade.
And while the Indian government is making all efforts to expand UPI globally, other countries are also experimenting with faster payment systems – some of which are inspired by the success of UPI.
The G20 Global Partnership for Financial Inclusion document prepared by the World Bank lists out some of the fast payment systems used by other countries.
Brazil’s PIX fast payment system allows fund transfers between all types of transaction accounts, creating a payment service ecosystem with low acceptance costs and high levels of usability. Through Pix one can transfer money using the e-mail address or a mobile phone number of the transferee. Like the UPI, Pix also actively uses QR codes as the access channel. Launched by the Central Bank of Brazil in November 2020, approximately 109 million consumers and 7.6 million businesses, mostly MSMEs, were active users of the platform by December 2021. According to the World Bank report, the success of Pix lies in the single name and brand (building recognition and trust in the system), mandatory participation of big banks, low transaction costs, and a multiplicity of use cases, including P2P transfers, tax and bill payments, online, and card-present purchases.
Thailand’s PromptPay is a fast payment service with real-time clearing and settlement combined with a proxy look-up service that securely maps a national ID number, corporate tax ID, or phone number to a bank account. PromptPay was launched in January 2017 and by mid-2019 had enrolled 70% of the population. Banks charge no fees for using the service, and they have deployed an interoperable QR code system that has resulted in a shift from cash transactions to digital. By mid-2019, more than 3.7 million merchants were accepting PromptPay QR payments, compared to 140,000 merchants accepting cards with 480,000 traditional point-of-sale (POS) devices.
Indonesia’s BI Fast is a fast payment infrastructure that refers to a method of transferring funds or making payments that is characterized by its speed and efficiency, 24/7, 365 days for bank and nonbank customers by direct and indirect membership model. It is built by Bank Indonesia (BI) to facilitate near-instantaneous transactions, allowing individuals or businesses to send and receive money quickly. BI Fast methods can include instant bank transfers, mobile payment apps and digital wallets. These systems aim to provide convenient and swift financial transactions, enhancing the speed and convenience of everyday commerce. Since its launch on 21 December 2021, the total number of BI-FAST participants has reached 122 participants as of March 2023, representing 94% of the share of national retail payment system.
Turkiye’s Instant and Continuous Transfer of Funds System (FAST), developed in-house and operated by the Central Bank of the Republic of Türkiye (CBRT), was launched in January 2021. Originating from a demand from end users and banks, this new infrastructure paves the way for the reduction of cash usage and significant improvements in the payment ecosystem in the country. FAST offers continuous availability, enhanced speed, and a diversity of use cases and access channels. In addition, a range of overlay services, such as QR codes and aliases (a service called Easy Addressing), aim to enrich the user experience. There are plans to complement these features in the near future with other functionalities, such as request to pay. These overlay services are created and operated by the Interbank Card Center (BKM), which is jointly owned by the CBRT and major commercial banks and has proven experience in the development of customer-facing solutions. Nonbank payment service providers are eligible to become direct participants in the system, even though none is participating for the time being. Since its launch, FAST has seen a rapid uptake, reaching an average of 8.8 million daily transactions in June 2023.
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