Simplification of the system of financial transactions, by removing barriers, has driven economic wellbeing and convenience of populations, historically. Last week, Reserve Bank of India (RBI) governor Shaktikanta Das exchanged remittances with the Monetary Authority of Singapore’s Managing Director Ravi Menon through UPI and PayNow — unveiling India’s first cross-border real-time payment system. Singapore, on the other hand, already has a similar payment link with Thailand, and is among limited South-Asian countries striving to establish an interconnected digital payment system. Building on the trinity of JAM — Jan Dhan Yojana, Aadhar and mobile phones — and facilitated by the pandemic and subsequent lockdowns, UPI payments have indeed revolutionised India’s domestic payment system. The metric rise of the payment system can be gauged from the fact that it increased from Rs 8,31,993 crore in January to Rs 12,81,971 crore in December. The value of transactions for January 2023 stood at almost Rs 13 lakh crore. The UPI-PayNow linkage is a landmark development that would set the template for scaling up of India’s instant payment system at an international stage. The initiative effectively allows Indians living in Singapore to send money instantly for the ‘maintenance of a relative’ or as a ‘gift’ — the same goes for transactions from India to Singapore. The threshold for the ‘low-cost’, transboundary money transfer has been kept at Rs 60,000 (or ~ 1,000 Singaporean Dollar). Given India’s strong diasporic relations with Singapore, the payment linkage assumes fair significance. It will not only “bring the benefits of digitalisation and fintech to the common man” but, by facilitating cross-border instant payments, also increase the volume of remittances to India. At the launch of the payment linkage, Singapore's Prime Minister Lee Hsien Loong affirmed that, currently, remittances between the two countries amount to USD 1 billion. Furthermore, large number of migrant workers are reported to have been working at shipyards and dockyards of Singapore. As more money floats in, India’s foreign reserves will certainly gain some strength. The move is also important from the safety point of view. Given that UPI payments do not require recurrent submission of bank details and skip middle men, due cleansing of the process of transferring remittances remains a healthy prospect. Furthermore, going by the statement made by the Reserve Bank of India (RBI), “the interlinkage aligns with the G20's financial inclusion priorities of driving faster, cheaper and more transparent cross-border payments.” Indeed, there is a long way to go when it comes to internationalisation of UPI payments, but a beginning has been made. In the first place, the ambit of transactions has been deliberately put under limitations. For the start, State Bank of India, Indian Overseas Bank, Indian Bank and ICICI Bank will facilitate both inward and outward remittances while Axis Bank and DBS India will facilitate inward remittances. Secondly, the transfer of remittances can be done through participating banks’ mobile applications and internet banking only. Popular payment platforms, including PhonePay and GooglePay, have been kept out of the system. These limitations are most likely to be done away with in the near future. Last November, during a meeting between the foreign ministers of India and the United Arab Emirates (UAE), allowing cross-border remittances through UPI platforms was considered. Though these are initial steps, given the larger vision of the Indian government, it won’t be wrong to expect that more countries will be taken within the fold sooner than later. It has also been reassured that with time, popular instant transaction platforms will be roped in. Remittances from Singapore, though huge, constitute a meagre proportion of India’s fast-increasing overall remittances. In 2021/22 itself, India received USD 89 billion in foreign remittances — the highest ever in a year by any nation. Furthermore, as per an estimate by the World Bank, India’s remittances will touch a whopping USD 100 billion in the current year. This backdrop gives the Indian government more than enough reasons to prioritise linking its trademark UPI system with equivalent platforms of trustable and important partner countries. History is evidence that every time a boundary is broken in pursuit of simplifying monetary transactions, economies and humanity have benefitted immensely. The linkage of UPI and PayNow systems presents a hope for establishing a more seamless financial transaction system, globally.