Asia is advancing financial unity through collaborative initiatives for seamless cross-border payments 

Governments, central banks, and private sector innovators drive payment integration and economic cohesion in the ASEAN region

Several nations have jointly launched a regional cross-border payment system to bolster financial integration and foster economic cohesion. volodyar/Shutterstock

Governments, central banks, and private companies across Asia are collaboratively advancing efforts to boost payment integration, connectivity, and interoperability. According to the Asian Banker, initiatives such as ASEAN’s Regional Payment Connectivity (RPC) cooperation and payments policy framework are driving innovations in cross-border transactions. These efforts are aimed at promoting transactions that are not only faster but also more affordable and inclusive.

Private sector entities, including Swift, Visa, Mastercard, and Alipay, are actively introducing technologies to facilitate seamless cross-border payments. The RPC initiative is aligned with the G20’s roadmap and is geared towards supporting ASEAN’s overarching goal of establishing interconnected payment systems. This endeavour involves the digitization of financial sectors, integration of standardised QR code payments, and the implementation of real-time remittance systems, all of which are streamlining processes and nurturing economic integration within the region.

In Southeast Asia, several nations have jointly launched a regional cross-border payment system to bolster financial integration and foster economic cohesion within the ASEAN bloc. As reported by CNBC, residents in Indonesia, Malaysia, Thailand, Singapore and the Philippines can now make payments using local currencies via QR codes. 

Related: What’s to come for ASEAN real estate in 2023

The primary objective of this system is to bolster cross-border trade, investment, remittances, and economic activities, thereby reducing reliance on external currencies like the U.S. dollar. Analysts anticipate that this initiative will yield benefits for retail industries and lead to an increase in tourism. Nonetheless, it comes with its share of challenges, including currency fluctuations, regulatory hurdles, and the necessity to educate the public. Despite these challenges, the initiative represents a significant stride towards achieving regional financial unity amidst global tensions.

Furthermore, Vietnam News has discussed how the State Bank of Vietnam (SBV) has inked a Memorandum of Understanding (MoU) with the central banks of ASEAN5 countries (Indonesia, Malaysia, Philippines, Singapore, and Thailand) to promote regional payment connectivity. The goal is to encourage cross-border payments using QR codes and establish a risk management system in compliance with local banking regulations. 

This collaborative effort will enable travellers to make payments via QR codes linked to their respective home country’s bank accounts, eliminating the need for currency exchange. The MoU not only supports economic integration within ASEAN but also envisions the expansion of QR code payment links for cross-border transactions beyond the region, ultimately benefiting various industries and small and medium-sized enterprises (SMEs).

The Property Report editors wrote this article. For more information, email: [email protected].