SINGAPORE – Some merchants will soon find it easier to sign up for cashless payment schemes, while consumers will have more payment options by scanning just a single QR code.
From Wednesday, selected merchants need to sign up with only a single financial institution to accept payments from various cashless payment methods using an enhanced QR code system.
The trial, conducted by the Monetary Authority of Singapore (MAS), kicks off on Wednesday and will last till Nov 30.
It will test the upgraded Singapore Quick Response Code Scheme (SGQR+) at more than 1,000 merchant acceptance points at the Singapore FinTech Festival at Singapore Expo and in Changi districts 16 and 17, which include areas such as Bedok and Loyang.
The festival, which will be held from Nov 15 to 17, will include a showcase and presentation of the SGQR+ trial.
Twenty-three payment schemes will be involved in the trial, including Alipay, Changi Pay, GrabPay, Visa and WeChat.
SGQR+ is an enhancement of SGQR that was introduced in 2018 to combine multiple payment QR codes into a single label.
“SGQR has become widely adopted by merchants as a simple and trusted solution to accept payments digitally,” MAS said in a statement.
“However, merchants that wish to accept a range of payment schemes (local or foreign) need to maintain commercial relationships with different financial institutions.”
It added that consumers and tourists can use their preferred payment applications only if the merchant has a commercial relationship with the corresponding companies.
This is where SGQR+ comes in: It will allow consumers to gain access to a wide variety of payment options when the merchant signs up with just one financial company.
Under the trial, merchants can accept a range of local and cross-border payment schemes, allowing a wider range of customers and tourists to make payments easily.
MAS said in the statement: “With SGQR+, consumers can look forward to using their preferred payment applications at more merchant acceptance points.
“Tourists can enjoy transacting conveniently using their native payment applications as merchants empowered by the SGQR+ solutions will be able to easily accept more international payment schemes.”
Merchants on the trial can choose between two technology solutions – one led by fintech firm Liquid Group and the second by Nets.
Under the first option, Liquid Group will operate a switch that processes payments between the financial institution serving the merchant and the one serving the consumer.
Consumers who use mobile apps linked to credit cards can also scan and pay at merchants that participate in Liquid Group’s payment system.
Meanwhile, Nets will allow consumers to scan and pay with a variety of local and foreign payment schemes at its participating merchants.
This is an extension of the Nets solution that is already offered to hawkers on the Hawkers Go Digital Programme, which is subsidised by the Government. The programme has more than 13,000 merchant acceptance points and 21 participating payment providers.
“The proof of concept will test the commercial feasibility of deploying this solution across other merchant segments, with merchants paying for this service,” MAS said of the trial.
MAS chief fintech officer Sopnendu Mohanty said: “SGQR+ is a significant leap in interoperable QR payments. It will streamline payment acceptance for merchants and substantially increase the number of merchant acceptance points for both local and foreign consumers to use their preferred e-wallet or banking application.
“The proof of concept launch paves the way for Singapore to become a global leader in QR payments and a potential QR payments hub.”
Liquid Group chief executive Jeremy Tan said participating in the trial enables the firm to play a more supportive role in the ecosystem and position Singapore as a payments hub while levelling the payments space and opening it up to more participants.
More customers, particularly inbound tourists, can also benefit from the wider range of payment options offered by merchants, said Nets Group chief executive Lawrence Chan.
For example, SGQR+ has increased the QR payment options offered by Arnold’s Fried Chicken from five to 20. The fast-food chain’s Bedok outlet is one of the merchants participating in MAS’ trial, using Nets’ technology solution.
Mr Mervyn Lee, the chain’s corporate services manager, said: “This provides us with convenience and the customers are no longer tied down by more dominant payment options. They are free to choose whichever payment scheme they are more comfortable with using.”
He added that SGQR+ will make backend processes easier for the chain as instead of having 20 different accounts to deal with at the end of the month, the firm will have to deal with only one, since payment will be funnelled through Nets.
Mr Lee said there were customers who asked for specific payment options, but the merchant was unable to offer that option.
“While we didn’t turn them away explicitly, the lack of payment options could cause us to lose customers,” he said.
He added that while the firm is open to paying more for wider payment options, it will still have its cost considerations as a business.
“Speaking as a consumer, it is always better to have more options,” he said. “That is what SGQR+ extends to customers and it is a win-win for us.”
Mr James Fong, manager of Nanyang Polytechnic’s Singapore Institute of Retail Studies, said the scheme is poised to be a significant turning point for both retailers and consumers.
“Retailers today confront several challenges concerning digital payments, from paramount security issues, such as data breaches and fraud, and costs associated with payment processing to the intricate task of managing diverse payment systems within their point-of-sale systems,” he said.
He added that this move will result in potential cost savings and streamlined operations for businesses.
The results of the trial will be published in a report next year and the public will be updated on whether SGQR+ can be rolled out on a wider scale.
