Bank Indonesia (BI) and the Monetary Authority of Singapore (MAS) today launched the cross-border quick response (QR) payment linkage between Indonesia and Singapore.
This linkage enables customers of participating financial institutions [1] to make seamless cross-border retail payments using their existing mobile banking applications to scan QRIS (Quick Response Code Indonesian Standard) or NETS QR codes [2] displayed by merchants in Indonesia and Singapore respectively. BI Governor, Perry Warjiyo, and MAS Managing Director, Ravi Menon, jointly launched the linkage by making live cross-border QR payments at the Singapore FinTech Festival 2023.
This cross-border QR payment linkage is a significant milestone in the efforts by BI and MAS to promote greater integration of the digital economy and financial ecosystem, as well as to boost economic connectivity between Indonesia and Singapore. With greater payment convenience, this linkage can enable micro and small businesses to tap into a new pool of customers in each other’s economies. It will also benefit a significant number of travellers between the two countries, with travel rebounding post-pandemic – in the first half of 2023, there were 600,000 arrivals from Singapore to Indonesia, and 1.1 million travellers from Indonesia to Singapore [3] .
BI and MAS have also signed a Letter of Intent (LOI) to establish a local currency settlement framework. When operationalised in 2024, the framework will facilitate the settlement of cross-border payments, including QR payments, trade and investments between Indonesia and Singapore in their respective local currencies. This will help businesses and other users reduce their exposure to exchange rate risks and costs. The LOI follows the signing of a Memorandum of Understanding on a framework for cooperation to promote bilateral transactions in local currency (LCT Framework) by both central banks in August 2022 [4] and is in line with ASEAN financial integration efforts to facilitate the wider use of local currencies in intra-ASEAN transactions [5] .
Mr. Perry Warjiyo, Governor of Bank Indonesia said, “Cross-border QR payment linkage between Indonesia and Singapore will promote faster, cheaper, more transparent, and more inclusive cross-border payments, particularly for the benefits of micro, small, and medium enterprises. The linkage serves as follow-up of the commitment among ASEAN members on Regional Payment Connectivity, and the Indonesian Payment Systems Blueprint 2025. It provides a more convenient and efficient payment method for users. In our ongoing commitment, we are also excited to announce our strategic initiative to promote a wider use of local currencies in bilateral transactions through the LCT framework, which is expected to be implemented in 2024. After LCT Framework implementation, the cross-border QR payment linkage initiative will use direct quotations of local currency exchange rates provided by the Appointed Cross Currency Dealer (ACCD) banks.”
Mr. Ravi Menon, Managing Director of MAS, said, “The QRIS-NETS QR payment linkage will promote cross-border e-commerce activities and tourism spending across Singapore and Indonesia, by individuals and small businesses. The upcoming local currency settlement framework by BI and MAS will complement this payment linkage by facilitating the use of Indonesia Rupiah and Singapore Dollar for the settlement of cross-border payments. These initiatives mark another milestone for Singapore’s growing cross-border payments linkages with key regional economies.”
This QRIS-NETS QR payment linkage has been made possible through strong industry collaboration championed by BI and MAS, alongside close partnerships with the Indonesian Payment System Association (ASPI), RAJA (Rintis, Artajasa, Jalin, and Alto), Network for Electronic Transfers (Singapore) Pte. Ltd (NETS) and participating financial institutions.
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[1] Participating financial institutions from Singapore are OCBC and UOB, with DBS joining at a later stage. Participating financial institutions from Indonesia are PT Bank Central Asia Tbk, PT Bank CIMB Niaga Tbk, PT Bank Pembangunan Daerah Bali, PT Bank Permata Tbk, PT Bank Syariah Indonesia Tbk, PT Bank Mega Tbk, PT Bank Sinarmas Tbk, PT Bank Rakyat Indonesia Tbk, PT Espay Debit Indonesia Koe, PT Netzme Kreasi Indonesia.
[2] QRIS is the national standard of QR code payments in Indonesia. NETS QR is the QR code solution operated by Singapore electronic payment network NETS. QRIS and NETS QR allow merchants to accept payments from customers of different participating banks and e-wallet operators using a unified QR code.
[3] Data of January to June 2023 (source: Statistics Indonesia and Statistics Singapore, 2023).
[4] Indonesia and Singapore to Pursue Cross-border QR Code Payments Connectivity and Explore Promoting the Use of Local Currencies for Bilateral Transactions
[5] The 10th ASEAN Finance Ministers and Central Bank Governors Meeting in August 2023 endorsed the High Level Principles to guide the development of an ASEAN Local Currency Transactions (LCT) Framework to enhance accessibility and efficiency in local currency transactions and promote its wider adoption by market participants in the region.