Why It Matters

Big step to a cashless society

PayNow, going live on July 10, marks a vital milestone in Singapore's journey to become a smart nation.

The fund transfer system, allowing people to send money to friends and family using only the recipient's mobile or NRIC number, is a big step towards creating a cashless society.

It builds on earlier steps by banks and the finance industry, and makes fund transfers truly convenient.

Fast, launched in 2014, made it possible for people using accounts from different banks to transfer money to one another within seconds - not days.

Then, several banks here began developing their own fund transfer services, such as DBS' PayLah!, OCBC's Pay Anyone, United Overseas Bank's UOB Mighty and Maybank's Mobile Money.

Finally, these efforts are coming together in a seamless whole. PayNow does not make existing apps and services obsolete, but makes them easier to use.

 

So, what is next? While PayNow helps with transfers to other people, it does not improve commercial transactions.

Singapore lags behind tech-savvy nations such as China, where WeChat users can book a restaurant table, order food and pay - all using the same app.

Again, individual banks have begun making this a reality in Singapore. For instance, Standard Chartered's Dash app, co-developed with Singtel, allows for e-payments in stores like Watsons, in Comfort cabs and on public transport.

The UOB Mighty app serves as an all-in-one mobile banking app and wallet similar to Android Pay - letting people pay with mobile phones.

But the weak link in the chain is the end point - the retailer. Many small businesses still accept only cash. Some take only certain credit cards. Some allow mobile and PayWave payments, while others do not.

As Monetary Authority of Singapore managing director Ravi Menon said last year, acceptance points need to be enhanced. PayNow proves that when the industry puts its mind to it, it can achieve true convenience here. Now, to get retailers on board too.

A version of this article appeared in the print edition of The Straits Times on July 01, 2017, with the headline 'Big step to a cashless society'. Print Edition | Subscribe