(ATF) The central banks of Thailand and Singapore have linked their respective PromptPay and PayNow real-time retail payment systems, a timely digital connection given that direct travel between the two countries is unlikely to resume in the near future.
Describing it as the first of its kind globally, Bank of Thailand (BOT) and the Monetary Authority of Singapore (MAS) said in a statement the linkage followed several years of collaboration between payment system operators, bankers' associations and banks.
Customers of participating banks in Thailand and Singapore will be able to transfer up to S$1,000 or 25,000 baht daily between the countries, using just a mobile phone number.
The process will not require a user to populate fields such as the recipient's full name and bank account details, as required with a normal remittance.
"This service by the MAS and the BOT will effectively address customers' long standing pain points in the area of cross-border transfers and remittances including long transaction times and high costs," BOT Governor Sethaput Suthiwartnarueput said in the joint statement.
Initially, Bangkok Bank, Kasikornbank, Krung Thai Bank and Siam Commercial Bank will provide the service in Thailand, according to the BOT. In Singapore, DBS Bank OCBC and United Overseas Bank will be providers.
Ravi Menon, managing director of MAS, said the shared objective with the BOT was to work with other Association of Southeast Asian Nations (ASEAN) members "to expand this bilateral linkage into a network of linked retail payment systems across ASEAN."
The linkage comes as Thailand experiences a major resurgence of Covid-19 cases. The country has reported an average of nearly 2,000 daily cases over the past week. To contain the spread, the government has announced the closure of schools, bars and other entertainment venues.
"A jump in new virus cases in Thailand is already showing signs of holding back the recovery and could jeopardise plans to reopen the crucial tourist sector," Gareth Leather, a senior Asia economist at Capital Economics, said.
"Despite its initial success in containing Covid-19 – there have so far been fewer than 200 deaths from the disease – Thailand is now experiencing a major outbreak," he added.
Meanwhile, Singapore was able to do further loosening of Covid-19 containment measures in late March. "Social distancing is no longer a major drag on the economy," Leather said.
Most Asian currencies are expected to depreciate against the US dollar this year, except the Singapore dollar. MAS's foreign exchange settings will be likely to be left unchanged at the next policy review.
"We continue to expect the Singapore dollar to gain over the long-term," said Brian Tan, Barclays analyst.
With reporting by Reuters