🇸🇬 Payments in Malaysia and Singapore

Two neighboring markets, two opposite architectures

Retail interbank rails are the infrastructure that carries credit transfer and payment instructions between institutions. They are owned either by the banking industry or by the central bank, and Singapore and Malaysia, separated by the Johor Strait, have each chosen one of those two models. Singapore built its infrastructure through the banks. FAST, GIRO, and the NETS debit scheme belong to the industry, and the central bank sets the rules without owning the infrastructure. In Malaysia, it is the reverse. Bank Negara Malaysia is the majority shareholder of Payments Network Malaysia (PayNet), which operates all of the country’s retail rails. Malaysia’s central bank mandates by regulation what its Singapore counterpart achieves through industry coordination.

That difference in ownership shapes the legal form policy decisions take in each country. In Malaysia, an interchange cap, a routing requirement, or a deadline to phase out proprietary QR codes arrives as a binding policy document issued under the Financial Services Act 2013. In Singapore, the equivalent takes the form of a display standard, a shared responsibility framework, or a timeline negotiated with the Association of Banks in Singapore. Both approaches produce rules that work. But they give the firms subject to them different implementation periods and different avenues of recourse.

These opposite architectures change the order in which a merchant builds out acceptance. In Singapore, acceptance is negotiated with an acquirer or a payment service provider (PSP), and the account-to-account (A2A) rail is added as one more payment method. In Malaysia, the A2A rail is the dominant method, cards come second, and access goes through a PayNet participant. The technical integration and the acceptance contract therefore depend on which side of the strait the merchant collects payments.

Singapore: FAST, PayNow, GIRO, and the end of business checks

FAST is Singapore’s instant retail credit transfer rail. Launched in 2014, it is operated by Banking Computer Services for the Association of Banks in Singapore, and its positions settle finally in MEPS+. Three years later, PayNow added a proxy resolution layer that accepts a mobile number, national ID number (NRIC), or foreign identification number (FIN) for individuals, and, since PayNow Corporate, the UEN (Unique Entity Number) for businesses. Non-bank institutions were admitted next. As of December 2025, there were 11 million registered proxies, covering more than 90% of the adult population, plus about 350,000 legal entities (MAS and ABS, PayNow Gen2 phase 1 report, June 25, 2026). With coverage at that level, a payer can almost always identify the recipient by proxy, with no prior exchange of bank details.

GIRO is Singapore’s batch credit transfer and direct debit system, with deferred settlement. Launched in 1984, it handles recurring bills, salaries, and tax payments, while eGIRO has digitized mandate setup, which long required a paper signature. Interbank GIRO handled 123 million transactions in 2024, worth S$672.9 billion, or 19% of the volume and 40% of the value cleared through the automated clearing house (MAS). What separates GIRO from PayNow is who initiates the payment. A GIRO mandate lets the payee trigger the debit when it falls due, while a PayNow transfer requires the payer to act each time a payment is due.

Malaysia: PayNet’s lineup, from FPX to DuitNow AutoDebit

Payments Network Malaysia, or PayNet, is Malaysia’s national payment systems operator. It runs every retail rail in the country, from the RENTAS RTGS system to the national QR code. Bank Negara Malaysia holds a majority stake alongside 11 financial institutions, and the central bank has said it intends to reduce that stake. Because the operator is owned by its regulator, a regulatory decision translates directly into infrastructure changes, which speeds up adoption of national schemes. Whether that arrangement is competitively neutral is a recurring debate. For a foreign provider, the consequence is about access to the rails. There is only one way in, and it is regulated: access to the rails goes through a PayNet participant.

In Malaysia, volume growth shifted from banks to non-banks over the last fiscal year. Bank transactions grew 30.7% and wallet transactions 71.7% (PayNet, 2026). Growth now comes from e-money issuers connected to the shared infrastructure, no longer from banks. Bank Negara Malaysia’s interoperability requirement ensures that a merchant enrolled in DuitNow QR through its acquiring bank alone still receives payments initiated from those wallets.

National QR codes: a display standard versus an interoperability mandate

SGQR is Singapore’s national payment QR code standard, launched in 2018 under the Singapore Payments Council, where MAS and IMDA (the Infocomm Media Development Authority) sit. It is a display standard. A single label carries the data for several domestic and international schemes, each keeping its own clearing channel and its own acquirer. The merchant shows just one sticker at the counter, but its contracts, statements, and reconciliations remain separate for each scheme.

DuitNow QR rests on a mandatory connection, not a display convention. The Interoperable Credit Transfer Framework, published by Bank Negara Malaysia in March 2018, requires banks and e-money issuers to connect to the shared infrastructure operated by PayNet and to accept the same code. The result is one code, one clearing scheme, and one operator. In Malaysia, a merchant therefore reconciles a single consolidated flow; in Singapore, it reconciles one flow per scheme accepted.

SGQR+ is Singapore’s response to this fragmentation of contracts, run by NETS on a master acquirer model. The merchant signs with a single acquirer, which aggregates the issuing wallets. The proof of concept generated 65,204 transactions worth S$1.29 million in one month, and 76% of participating merchants and 86% of financial institutions said they supported it (NETS). The island-wide rollout, announced in late 2024, aims to grow acceptance points from 24,000 to 35,000 by bringing in hawkers (street food vendors).

DuitNow QR acceptance costs take the form of a merchant discount rate charged per transaction, and its level is often misunderstood. In 2023, the Malaysian press reported it at 0.25% for payments funded from a bank account and 0.5% for card-funded payments. PayNet then clarified that the fee had existed since the 2019 launch and had been waived during the pandemic. Many banks and issuers kept the waiver for micro and small merchants. The fee schedule therefore applies in principle to every merchant, but whether it is actually charged depends on the acquiring institution and the merchant’s size.

Cross-border links: PayNow–PromptPay, PayNow–UPI, PayNow–DuitNow

A bilateral instant payment link is a direct connection between two national real-time payment systems that replaces the chain of correspondent banks. Singapore was the first country to connect its instant rail to a neighbor’s in this way. The PayNow–PromptPay link with Thailand went live in April 2021. A Singapore resident can send money to a Thai mobile number, with currency conversion handled within the link. Two years later, PayNow–UPI connected Singapore and India. The Malaysia–Singapore corridor then adopted the same model unchanged, followed by the Nexus blueprint.

These links have a limited functional scope. A bilateral instant payment link primarily covers person-to-person transfers and QR payments by travelers to merchants; it is not a cross-border e-commerce collection channel for businesses. Limits are set by each participant, not by the corridor itself. The exchange rate is set by the designated settlement banks, and its transparency varies from one corridor to another. Those three features explain why bilateral corridors are not used as corporate treasury rails.

Singapore as a licensing hub, Malaysia’s approval regime

The Payment Services Act 2019, in force since January 28, 2020, is Singapore’s licensing regime for payment services. It made the city-state Southeast Asia’s go-to licensing hub. The Act replaced two earlier regimes with a single modular license covering seven regulated services: account issuance, domestic money transfer, cross-border money transfer, merchant acquisition, e-money issuance, digital payment token services, and money-changing. An operator applies only for the services it actually provides. The Act sets out three license classes, based on transaction volume and outstanding e-money.

Malaysia’s regime is based on approval by type of activity. Bank Negara Malaysia approves payment system operators on the one hand and issuers of designated payment instruments on the other, under the Financial Services Act 2013 and its Islamic counterpart. Approval depends on the activity and the entity carrying it out; crossing a volume threshold does not change a firm’s status. Since 2018, the ICTF’s interoperability requirements have applied as well, now carried over and tightened by the IFTF of June 30, 2026.

Singapore added a stablecoin framework on August 15, 2023. It covers single-currency stablecoins, tokens pegged to a single currency, when that currency is the Singapore dollar or a G10 currency and the token is issued in Singapore. Reserves must be denominated in the reference currency and held in cash, cash equivalents, or sovereign debt securities with a maturity of three months or less; they must be attested monthly and audited annually. Redemption at par must occur within five business days of a request. The issuer may not conduct any business other than issuance.

Acceptance costs: interchange capped on one side, uncapped on the other

Interchange is the fee an acquirer pays the issuer on each card transaction. Malaysia caps it; Singapore does not. Bank Negara Malaysia’s Payment Card Framework sets caps by card type that are binding on networks and acquirers and, since January 1, 2023, subject to review every three years. The caps derive their legal force from sections 33(1)(a) and 143(2) of the Financial Services Act 2013, and sections 43(1)(a) and 155(2) of the Islamic Financial Services Act 2013. Because the caps bind acquirers, a Malaysian acquirer that does not break out the interchange applied by transaction type falls outside the framework.

In Singapore, no regulatory cap applies to interchange. Pressure on acceptance costs comes from three market forces: competition among acquirers, the weight of account-to-account transfers that are free for the payer, and the aggregation of wallets behind SGQR+. The domestic scheme NETS, founded in 1985 and owned in equal shares by DBS, OCBC, and UOB, claims more than 150,000 acceptance points. It also runs eNETS for online payments, NETS QR, and the SGQR+ program.

Singapore’s public transit ticketing saw a policy reversal in 2024. On January 9, 2024, the Land Transport Authority announced that NETS FlashPay cards would be withdrawn from public transit, with a mandatory switch to SimplyGo by June 1. Thirteen days later, on January 22, the decision was reversed after a public outcry. Card-based ticketing will remain until at least 2030, at a cost of S$40 million, and NETS has resumed selling and supporting the card (LTA, 2024).

Compliance, fraud, and what breaks in production

Instant payment fraud covers cases in which a payer is tricked into sending an irrevocable transfer to a fraudster. The two countries have tackled this risk in opposite ways. Singapore imposed the Shared Responsibility Framework, in effect since December 16, 2024, and issued jointly by MAS and IMDA. It assigns duties to financial institutions and telecom operators, then sets out a waterfall for compensating phishing victims. The financial institution bears the full loss if it breached any of its duties; if it did not, the telecom operator is next in line. There is no cap on compensation.

Malaysia opted for an operational tracing tool rather than a liability regime. The National Scam Response Centre, set up in October 2022, coordinates reporting. The National Fraud Portal, launched in August 2024 by Bank Negara Malaysia, PayNet, and 16 financial institutions, automates the tracing of stolen funds across the entire financial system. Its results are published: about 57,700 victim accounts were identified and nearly RM46 million was set aside for restitution in fiscal 2025 (PayNet, 2026).

• The proxy is not the account. A Singapore UEN or a DuitNow ID returns a recipient name that is displayed before confirmation. When the registered company name differs from the trading name the customer knows, the customer sees a name they don’t recognize and abandons the payment at that screen. The fix lies in the proxy registration, not in the payment interface.
• A2A credits are irrevocable. Neither PayNow nor DuitNow offers an equivalent of the card chargeback. Recourse goes through the national anti-fraud framework (the SRF in Singapore, the National Fraud Portal in Malaysia) and bank cooperation, not through a contractual dispute process.
• Static and dynamic QR codes reconcile differently. A static QR code carries only the merchant’s details and leaves the customer to enter the amount: the incoming credit carries no order reference, and matching it to the sale is manual. A dynamic QR code, generated for a specific transaction, embeds the amount and that reference, which makes matching automatic.
• FPX depends on each bank’s availability. Because the payment completes at the customer’s bank, an outage of that bank’s interface shows up as cart abandonment rather than an explicit decline. The failure is visible only in conversion rates measured bank by bank; the overall rate dilutes it across all institutions.
• Final settlement is not the credit to the recipient. MEPS+ and RENTAS settle positions after the fact, with cutoff times. A late payment appears on the bank statement only on the next business day, which delays reconciliation even though nothing has failed.
• Cross-border links set limits by participant. Limits on PayNow–DuitNow or PayNow–UPI are set by each connected bank or institution, not by the corridor itself. The limit that applies to a given payment is therefore found in the terms of the participant processing it, and the corridor’s launch announcement does not include it.

Both markets have complete retail rails and are going through continuous, regulation-driven change. The IFTF runs in Malaysia until 2028. Singapore is simultaneously rolling out PayNow Gen2, phasing out business checks, and deploying InvoiceNow through 2031. These deadlines are set by regulation and bind every player operating locally. Bank Negara Malaysia and MAS publish these timelines several months before acquirers’ sales briefings pass them on.