A bold new plan to enable money transfers using only mobile phone numbers is being explored as the banking industry looks at ways to improve payment technologies.
Monetary Authority of Singapore (MAS) managing director Ravi Menon revealed the initiative yesterday as he underlined the progress that Singapore has made towards becoming a smart financial centre.
Speaking at the closing of the Sibos banking industry event yesterday evening, he said banks involved in Fast and Secure Transfers (Fast) are studying a “mobile addressing system” for the service, which was launched in March last year to allow near-instant interbank fund transfers and payments.
“This means you will be able to make payments through Fast as long as you know the payee’s mobile number,” Mr Menon said.
Also, the Association of Banks in Singapore (ABS) aims to standardise retail point-of-sale (POS) terminals, he added.
“Our vision is a unified POS – a single terminal, preferably mobile, that can read all kinds of cards.”
If implemented, the new Fast mobile system would greatly streamline digital transfer services.
Several apps – including DBS Bank’s PayLah, OCBC’s Pay Anyone and United Overseas Bank’s Mobile Cash – have been rolled out by banks here to allow a user to transfer money to another using a mobile number, but these apps typically still require set-up and account information.
ABS director Ong-Ang Ai Boon confirmed that five banks, including the three local ones, started initial discussions on the concept last month. “The whole thing is still in a very nascent state,” she said.
“We are constantly looking for ways to improve productivity and efficiency for both the industry and consumers, but it will take time for us to make sure it is affordable and does not compromise on security.”
A local bank source told The Straits Times the new service is likely to involve a central registry pegging phone numbers to accounts.
This would mark a great step forward for Singapore banks, which are already active in digital and mobile initiatives.
Mr Menon also suggested that the industry go one step further and develop an all-in-one addressing system – which would mean “being able to pay someone through Fast using also the payee’s e-mail address, social network or other proxies”.
OCBC Singapore e-business head Aditya Gupta noted that Pay Anyone already allows that, although account information is also required of recipients.
He said: “If the new addressing system can help make payments more seamless, this would be a good way forward.”
The central bank has committed $225 million over the next five years to boost financial sector technologies, Mr Menon said.
Another common standard in the works is the unified POS – ABS has made more progress in this area than with the mobile addressing system, Mrs Ong said.
Meanwhile, achieving seamless data sharing is also a key thrust for ensuring greater cost efficiency for banks and regulators.
Mr Menon said MAS is considering using application programming interfaces to streamline regulatory data submissions by the industry.
“Our vision is for data to flow seamlessly in both directions between systems in the financial institutions and MAS,” he stressed.