In August 2017, the Payments Council, a group of leaders from banks, payment service providers, businesses, and trade associations, advocated the use of QR code-based payments as a practical and convenient way to introduce e-payments to merchants. However, it was noted the proliferation of more proprietary QR codes at merchants risked fragmentation of payment solutions and inefficiency among merchants and consumers.
The Payments Council then formulated an industry taskforce to develop a common QR code specifications for e-payments known as Singapore Quick Response Code (SGQR), a unified QR code that combines multiple payment QR codes into a single label to simplify QR payments for consumers and merchants. This means less clutter on the store front and quicker payments processing. The addition of new QR payments options, both domestic and international, are also streamlined into the single SGQR label. SGQR does not require a terminal, so it is a cheaper way to accept various e-payment options.
This is the work of the SGQR taskforce co-led by the MAS and Info-communications Media Development Authority consists of members from payment schemes, issuers, acquirers, banks and relevant Government Agencies. FOMOPay is a proud partner of the SGQR initiative and seeks to work cohesively with the MAS and mark a significant step in Singapore’s drive to build a national cashless system.
Dubbed SGQR and described as the world's first unified payment QR code, the system will allow customers to choose from a host of e-payment solutions such as GrabPay, Dash and Nets that enables them to quickly and easily pick their preferred QR payment option on the merchant’s SGQR label. Merchants will only need to display a single SGQR label showing the e-payments it accepts. This follows Prime Minister Lee Hsien Loong’s call at last year’s National Day Rally for an interoperable e-payment system in Singapore that is simple to use. According to MAS, the Payments Council recognized electronic payments as an enabler to enhance businesses in Singapore, especially now that it approaches the Smart Nation initiative.
The initiative fronted by NETS to bring a unified e-payment system to hawker centres, coffee shops and canteens will also support SGQR. Now, some 70 per cent of hawker transactions are done using cash. Conversely, 70 per cent of transactions at malls are already cashless.
Fast hit mainstream use in July last year with the launch of PayNow, which allows users to make fund transfers using people’s mobile phone numbers or NRIC numbers. Users need not enter bank account numbers anymore. Since then, 1.2 million mobile numbers and 550,000 NRIC numbers have been linked to bank accounts. About $1.5 billion has been transferred by PayNow.
Speaking at the launch, Education Minister Ong Ye Kung, who is also a MAS board member, also touched on other initiatives that he described "as the last few jigsaw pieces" to complete the national e-payment infrastructure. For one thing, regulations for payments have to be "transparent, easily understood and give sufficient peace of mind to all parties", he said. "We have taken some time to build up an open, accessible and inter-operable e-payments infrastructure which fosters competition, innovation and enhances consumer experience. SGQR is our latest feature, and we are developing the next piece in the national e-payments infrastructure through broader access to e-wallet players. But consumers will only use e-payments when they feel safe," Mr Ong added.
One of the initiatives is a set of user protection guidelines, to be released at the end of this month. The guidelines, among other things, will aim to apportion liability for unauthorised transactions between financial institutions and users. For instance, if the unauthorised transaction is caused by the financial institution, it will bear the entire loss. For unauthorised transactions caused by a third party and below S$1,000, financial institutions will similarly bear the loss. When the transaction is above S$1,000, the financial institution will have to investigate the case further and decide on a case-by-case basis.
"This is because transactions above S$1,000 require additional authentication and it is very unlikely that the user will be unaware of it, unless he did not take due care of his account," said Mr Ong. Mr Ong also announced plans to form a DIRECT FAST industry working group to help develop business and technical requirements for non-banks to connect directly to FAST, a transfer service launched in 2014 which enables customers of several banks here to transfer funds almost instantly. Apart from the operator of FAST, banks and MAS, other players like Grab, Liquid Group, MatchMove and Razer and TransferWise have also signed up for the working group.
"If we want the e-payment system in Singapore to be truly open, accessible and competitive, we will have to open up FAST to other non-bank e-wallet payment solutions so that they can interoperate with bank accounts," said Mr Ong, while adding that this is already underway in the UK and India where non-banks have been allowed access to central payment infrastructure to encourage competition. The Government will also seek expressions of interest to build and operate a FAST aggregator. This will help lower costs by aggregating the technical requirements across a number of players.