Real-time payments (RTP) are revolutionising how businesses interact with consumers.
RTP facilitates the instantaneous transfer of funds between parties. Unlike traditional payment systems that process in batches, RTP enables swift and secure transactions, often facilitated by advanced systems and modern financial technologies.
While RTP is growing globally, Southeast Asia is emerging as a hotbed of innovation and adoption. Fuelled by government and central banks’ support, the region lays the groundwork for an interconnected and effective payments ecosystem.
The market for real-time payments in Southeast Asia is booming, with a projected CAGR of 32.3% and an estimated annual transaction value of $32.3 billion by the end of 2024. This exponential growth underscores the region’s rapid transition towards a cashless economy and the increasing importance of RTP solutions in driving economic growth and financial inclusion.
What are ASEAN’s major RTP schemes?
Malaysia – DuitPay
- Operator: PayNet (owned by Bank Negara Malaysia)
- Year founded: 2018
- 2022 payment volume: 1.4 billion
- 2022 payment value: $357 billion
Indonesia – BI-FAST
- Operator: Bank Indonesia
- Year founded: 2021
- 2022 payment volume: 414 million
- 2022 payment value: $88 billion
Thailand – PromptPay
- Operator: National ITMX
- Year founded: 2016
- 2022 payment volumes: 14.8 billion
- 2022 payment value: $1.2 billion
Philippines – InstaPay
- Operator: Philippine Payment Management
- Year founded: 2022
- 2022 payment volume: 551 million
- 2022 payment value: $62 billion
What is Project Nexus?
Project Nexus, spearheaded by the Bank for International Settlements (BIS), aims to standardise how real-time payment systems connect cross-border. In 2022, BIS built a working prototype of Nexus and established it in Malaysia and Singapore.
The prototype works through Malaysia’s Retail Payments Platform and Singapore’s FAST payment system. The next phase will see a collaboration between banks in Indonesia, Malaysia, the Philippines, Singapore and Thailand. The final aim is to connect all domestic payment systems and enable 60-second cross-border transfers.
How else are ASEAN countries connecting?
2022 saw the central banks of Singapore, Malaysia, Thailand and the Philippines sign a payment linking agreement. The agreement enables cross-border QR payments in local currencies across the five markets. It’s hoped the process can support trade, settlement, and remittance. The end goal is an interconnected financial ecosystem.
Users can transfer funds between digital wallets linked to accounts with financial institutions. Malaysian tourists can pay with ringgit when purchasing goods in Singapore. Fees and rates are determined by mutual agreement between central banks.
The US dollar will initially underpin the scheme. Yet, CNBC reports that participants are keen to avoid overreliance on foreign currency for exchange. The scheme is unique to the region and is expected to be duplicated globally.
Want a quick one-glance view of the RTP market in ASEAN? Click here to download an infographic.
