Southeast Asia’s Payment Push

Source details

Policymakers want seamless digital transfers between countries to be obstacle-free.
Mass adoption of QR code payments occurred during the COVID-19 pandemic when governments urged merchants to move away from cash.
Example: a $2 sunglasses purchase at Bali’s Pura Tanah Lot paid by scanning a QR code; the transaction would likely not work with a mobile wallet from outside Indonesia due to domestic limits on QRIS.

Smartphone adoption soared after 2010, fueling digital platforms for rides, meals, and e-commerce backed by billions of dollars in venture capital.
Card usage, especially credit cards, is low in Southeast Asia, and many offline merchants lacked card readers, keeping cash dominant for small transactions.
Digital wallets allowed users to store money on phones and pay without cash, solving in-app and platform ecosystem payment frictions.
Early solutions were closed-loop (platform-specific) systems, efficient for platforms but fragmented for consumers and merchants, prompting regulators to push for open, standardized infrastructure.

Singapore pioneered the push:
- 2017: Banking association introduced PayNow, an instant payment system (IPS) for peer-to-peer transfers to mobile phone or national ID numbers and to businesses using unique entity numbers, in real time, 24/7, for free.
- NETS was expanded to support QR code payments at offline stores.
Other national systems:
- Malaysia: DuitNow.
- Thailand: PromptPay.
- Indonesia: BI-FAST and QRIS.
QRIS specifics:
- No processing charges for small businesses for payments below 500,000 rupiah ($30).
- Settlement is instant.
- Transactions above this threshold cost just 0.3 percent.
Despite domestic advances, most cross-border payments remained slow, opaque, and inefficient due to reliance on multiple correspondent banks and intermediaries.

Growing number of bilateral links established:
- Thailand–Singapore first in 2021; others include Singapore–India, Thailand–Malaysia.
- Indonesia announced plans for a QR code link with China and Japan.
Nexus Global Payments (NGP):
- Nonprofit established by several central banks in April 2025 to improve cross-border connectivity.
- Designed as a multilateral payment gateway to standardize how domestic IPSs connect to one another via a shared node (Nexus).
- Project Nexus concept originated at the Singapore Innovation Hub (a Bank for International Settlements initiative).
- Benefits: an IPS operator connects once to Nexus to reach all other countries in the network, reducing resource intensity compared with bilateral links.
Requirements for Nexus participation:
- Common technical standards and operating standards and processes.
- Alignment on data privacy, money laundering safeguards, and a consistent commercial model protecting stakeholders.
Timeline and expectations:
- NGP expected to appoint a technical operator to build and operate the network "this year" (as stated by MAS’s Kenneth Gay).
- MAS’s Gay: “We expect to see the first live cross-border transaction on Nexus around 2027,” before expanding to other interested countries.
Regional momentum:
- Region came together about two years ago under the Indonesian G20 presidency to prioritize regional payments connectivity, leading to NGP’s establishment and desire to scale globally.

Large-scale cross-border adoption depends on sustained collaboration between governments, central banks, and fintech players.
Smaller banks risk being left behind if they continue to “operate on legacy systems.”
Finastra’s Arun Kini: banks can benefit from tapping into burgeoning IPSs, but IPS popularity has “become a bottleneck for the banks” lacking technology to connect.
Innovation continues to address practical needs; example: QR codes attached to portable 4G-enabled speakers that deliver audio confirmation of payment amount received, useful in busy mobile-payment settings like tourist stalls.

2010: smartphone adoption surge began after this year (phrase: "after 2010").
2017: PayNow introduced in Singapore.
2021: PayNow–PromptPay bilateral linkage finalized after three years of collaboration.
April 2025: NGP established by several central banks.
500,000 rupiah threshold for QRIS fee exemption (equivalent given as $30).
0.3 percent fee for QRIS transactions above 500,000 rupiah.
First live Nexus cross-border transaction expected around 2027.

Standardize technical and operating standards across jurisdictions, including data privacy and anti–money laundering safeguards.
Adopt a consistent commercial model that protects the interests of central banks, regulators, fintechs, merchants, and consumers.
Prioritize multilateral gateway solutions (e.g., Nexus) over resource-intensive bilateral linkages to scale cross-border IPS connectivity efficiently.
Support smaller banks in upgrading legacy systems to prevent exclusion from evolving payment rails.
Encourage public infrastructure models that private fintech firms can use to promote interoperability across platforms.

Source: Southeast Asia’s Payment Push, F&D Magazine, Nadine Freischlad, September 2025.

Southeast Asia's Cross-Border Payment Push
- Southeast Asia's Cross-Border Payment Push (Markdown version)
- Southeast Asia's Cross-Border Payment Push (PDF)