India has outperformed heavy hitters such as Singapore, the US, China and Japan in a survey ranking the evolved digital payments systems of 25 countries. They were surveyed on parameters such as round-the-clock availability, adoption, and immediacy of payments, said a report released yesterday by Fidelity National Information Services Inc (FIS), a Florida-based banking technology-provider.
“A primary example of the importance of innovation is the impressive rollout of India’s Universal Payments Interface (UPI) that opens up access to real-time by allowing payments to be directly integrated into external business applications. Transactions using UPI increased 100 times from a modest 92,000 to 9.2 million transactions in the first nine months of operation,” said the report.
The report, titled Flavors of Fast: A trip around the world of immediate payments used the Faster Payments Innovation Index (FPII) created by FIS in 2014 and used a comparative rating system to contrast and evaluate diverse payments systems across the globe.
The FPII ranks different payments systems on a scale of 1-5, where level 1 reflects fast payments, level 3 reflects highly desirable features enhancing customer value such as universal access and 24×7 availability while level 5 payments systems have additional features for maximising customer value such as remittance information, push and pull capability and aliases.
The report classified the Immediate Payment Service (IMPS), launched by National Payments Corporation of India (NPCI) in November 2010, as an instant interbank electronic fund transfer service available through mobile phones and internet banking applications. Along with IMPS, the study also revealed the popularity of Unified Payments Interface (UPI) which is a combination of real time payments with open interfaces with an intention to replace cash, point-of-sale and wallet.
Transactions across UPI touched a new peak in November. The transaction volume was 105 million, up 37% from 76.8 million in the previous month, figures released by NPCI showed.
The report also highlighted that appropriate fraud prevention measures are vital for payment systems offering real-time clearing and settlement. Fraudsters are moving toward the initiation point, rather than later in the process, so a lot of activity is needed to monitor and manage at the initial authentication and origination level, it added.
Singapore’s Fast and Secure Transfers (FAST), a 24/7 electronic funds transfer service, got a rating of 4. The report stated that FAST was introduced as a result of growing demand for a faster and more efficient interbank funds transfer service. Prior to FAST, interbank funds transfer could take up to three working days. The survey positively identified ancillary services offered such as allowing consumers and businesses to move funds not only between conventional checking and savings accounts, but also to credit and debit card accounts where allowed by the participating bank. The only downside identified was the lack of an open application payment interface (API).