The service enables any member of the Singapore banking public with a bank mobile app from any of Singapore’s PayNow participating banks to begin making Singapore Dollar payments to eligible merchants in Malaysia.
(The PayNow participating banks are OCBC Bank, Bank of China, Citibank Singapore Limited, DBS Bank/POSB, HSBC, Industrial and Commercial Bank of China Limited, Maybank, Standard Chartered Bank and UOB.)
Singapore’s PayNow is comparable to Malaysia’s DuitNow. Through PayNow’s penetration into Malaysia, businesses can better serve their customers by collecting these cross-border payments in a more secure, immediate and transparent manner. Prior to the introduction of OCBC OneCollect, QR collection in Malaysia could only be made for local Ringgit currency transactions (through e-Wallet service providers and limited banks’ closed loop platforms).
According to OCBC Bank’s managing director & head of global transaction banking Chong Lee Ying, the move is expected to benefit both local small businesses and visitors and business-folk from Singapore who throng to various parts of Malaysia, with the service initially expected to focus on states such as Johor and Melaka.
“What this means is that businesses in Malaysia that operate in high volumes of low-value transactions are set to benefit. This would include those in retail, health and wellness, pharmacy, tuition and extra-curricular centres, food and beverages, and so forth.
“As an example, when someone from Singapore purchases durians from a shop in Johor and wishes to make payment, they can do so seamlessly from their own bank accounts directly through the OCBC OneCollect QR without having to go through the fuss of changing their currency beforehand.
“The durian seller simply taps on the “Collect” function. After keying in the transaction amount in Ringgit, the seller releases the durians to the customer upon successful notification.
“Singapore buyers can expect currency conversion rates as good as money changer’s or better when making purchases at OCBC merchants with their PayNow.
“In addition, our customers – the merchants – need not have a foreign currency account; they can expect to receive their collections in Ringgit,” she said.
Chong added that there would be significant benefits to the consumer, merchants and the overall economy.
“Merchants will find it easy to sign up for OCBC OneCollect as the mobile app can be easily downloaded from Google Play Store or Apple App Store. They will be able to register for the service through the app without the need for any paper submissions which would, of course, involve the hassle of a visit to the branch.
“Initially, our efforts will centre on selected clients in Melaka and Johor before venturing out further in the second quarter of the year,” she said.
Citing data from Singapore, Chong said the utilisation of PayNow has gained tremendous traction since its launch in Singapore in July 2017. As at the end of 2019, there were more than three million individuals and 129,000 business users registered with the PayNow service, with transaction value exceeding SGD12 billion.
“And based on statistics from Tourism Malaysia, Singaporeans made close to 11 million visits to Malaysia in 2018. With PayNow being availed across the border, these trips will become even more hassle-free, reducing the need to carry ringgit.
“OCBC Bank currently has 3,000 merchant customers in Malaysia and aims to grow this number to 10,000 by 2021. To achieve this, the app will be continuously enhanced at a later stage.
“For this year, we will not charge any fees. Merchants will be able to receive their settlement as early as two working days after the transactions are done. This is faster compared to other cross-border settlement options, which may take up to 14 days after the transaction. More importantly, settlement will be received in Ringgit, meaning there are no currency exchange risks and merchants being burdened by currency exchange fluctuations,” she said.
Local outfit, FOMO Solution Sdn Bhd, was the application developer for OCBC OneCollect.
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