Participating financial institutions and their customers will now be able to transact retail payments through NETS QR and DuitNow QR codes.
Officials from MAS said that the linkages will help boost cross-border commerce and enable merchants, especially small businesses, to tap on a wider pool of consumers. This QR code linkage between Singapore and Malaysia is a step in ASEAN’s journey towards seamless regional payments connectivity.
For on-site payments, store vendors or merchants will have physical QR codes displayed. It will also support online cross-boundary ecommerce transfers.
The Singapore-Malaysia collaboration was also backed up by Network for Electronic Transfers (Singapore) Pte. Ltd (NETS), the Association of Banks in Singapore, Payments Network Malaysia Sdn. Bhd. (PayNet), and participating financial institutions from both countries.
The next phase of the project is enabling cross-border account-to-account fund transfers and remittances, said the MAS and BNM. This feature would make real-time fund transfers between the two countries possible and convenient through a mobile phone.
This service will be made through PayNow and DuitNow with the expectation to launch by end-2023.
In order to make sure that Singapore is able to develop as an international financial hub, the MAS has issued a circular in March 2023 that reminds financial institutions of the importance of vigilance when it comes to money laundering and terrorism financing risks. The circular also comprised certain steps that financial institutions can take to tackle ML/TF risk in the wealth management sector, including private fund management.
Some of these points touched on the importance of strengthening FIs’ board and senior management oversight, risk, and control. This includes focusing on potential ML/TF exposures in segments where FIs have experienced a material increase in demand, keeping a closer eye on quality assurance reviews and testing done to validate AML/CFT measures, and equipping FIs’ risk and control functions to address contemporary ML/TF risk.
Other suggestions included enhancing existing customer due diligence practices in high-growth areas, as well as improving quality assurance testing in key control areas. The MAS also suggests continuing to exercise vigilance over higher risk customers. This can be done by monitoring suspicious conduct exhibited by potential customers, as well as keeping an eye out for legal structures and arrangements that may entail higher ML/TF risk in wealth management.
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