Faster bank transfers in Singapore with new service
SINGAPORE: Singapore’s national payment infrastructure is getting an upgrade.
A new service called Fast And Secure Transfers (FAST) will be rolled out on Monday, enabling instant fund transfers between banks, around the clock.
The Association of Banks in Singapore says FAST is introduced “in response to the increasing demand from consumers and businesses for funds transfer that is faster and more efficient”.
With more consumers transacting online, the launch is a timely one.
DBS, Singapore’s largest lender, says more than two million of their customers transact online, contributing 39,000 transactions or enquiries every hour.
OCBC Bank says it has seen online banking funds transfer transaction volume increased by 64 per cent over the past three years.
But industry experts say it is also important to Singapore as it secures its status as a financial hub.
In an increasingly digitised and connected world, consumers have come to expect that transactions can be done instantly.
However, a funds transfer between two different banks takes two to three working days. Currently, funds transfers work on GIRO — a system which has been around for 30 years.
But starting on Monday, a new system called FAST will become operational, making funds transfers between different banks instantaneous.
“FAST has to be seen as something which is going to consign cheques to the museum, and this is going to be a way of life for both the customers and the banks,” said Subba Vaidyanathan, regional head of retail banking segments and products at Standard Chartered.
“It also dramatically improves the way we look at productivity, because in a more digitised world, this should be the natural way in which we should be doing banking.”
At present, consumers looking to transfer funds may also have to spend time searching for additional information, such as the recipient’s bank and branch codes.
But this will no longer be necessary when FAST is rolled out on Monday, as consumers will only need to enter the recipient’s name and bank account number.
FAST is also expected to help improve cashflow management for businesses.
“So for example, to make a payment on the 10th, I don’t need to plan for it on the 7th or 8th. I just need to go on the 10th and make the payment,” said Pranav Seth, head of e-business & business transformation at OCBC.
“With this advanced payment infrastructure, this definitely puts Singapore on the map of countries with advanced payment networks, like South Korea and the United Kingdom.”
Mark Jansen, risk and financial services partner at PwC Singapore, said: “Singapore is once again showing great foresight and while some people might be nervous, this is not hugely different from the nervousness that was once seen with the move to ATMs or even GIRO.”
However, FAST caps transfers at S$10,000 dollars per transfer and it is limited to domestic transactions.
Tok Geok Peng, head of consumer deposits at DBS Bank, said: “FAST is a Sing dollar service, meaning it allows one to do funds transfers in Sing dollars, and within the participating banks in Singapore only. So for customers who want to remit money overseas, currently there are several services that banks or even remittance agencies offer.”
DBS will also allow retail customers to future date FAST payments, up to 30 days in advance. Corporate customers will be able to future date payments, up to 90 days in advance.
The Association of Banks in Singapore did not reveal an investment figure for FAST, but analysts estimate that a national payment infrastructure like this could cost the industry more than S$100 million dollars.
-Source : Channel NewsAsia