If a business payment utopia were to ever exist in Singapore, the payment method taking center stage in it would likely have these features:
- Ability to facilitate instant bank transfer.
- Having an arrangement to schedule recurring payments.
- Allowing easy termination of scheduled payment before it’s debited.
- Customization capabilities for different payments.
- Support for international transactions.
- Easy integration with corporate financial software.
- Latest and unbending security features.
- Little to no fees.
- Round-the-clock availability.
- No lower or upper transaction limit.
- Remote monitoring and online access from a centralized interface.
Business owners who are reading this and have been using eGIRO for a while may notice that eGIRO has already checked off some of the boxes here. Yet, one feature where eGIRO misses the mark is the support for international payments.
Why is international payment support important?
Most businesses are surfing the waves of globalization by shifting their focus to international trade. Many businesses realize that they can greatly profit from international sales due to the expanded market reach. There’s always a chance for a product to outperform overseas compared to its performance in its country of origin. This mainly happens when users overseas find the product more suitable or worthy than the users back home.
Similar logic could be applied to foreign partnerships. Some vendors abroad may provide better services to a business, making foreign business partnerships a great strategy for improving products and services.
What’s the reality right now in the context of eGIRO?
Like GIRO, eGIRO doesn’t support fund transfers to accounts overseas. Although methods like telegraphic transfers and card payments exist, transactions done using them may not be instant or affordable.
Due to the lack of support for international payments, many Singaporean businesses that deal with foreign partners may not be optimistic enough to adopt eGIRO as the default payment method.
Why should eGIRO have international payment capability?
So here’s the gap that has clearly surfaced:
- On one hand, there’s eGIRO, which offers convenient and instant interbank transfers, but international transfers aren’t possible.
- On the other hand, there are telegraphic transfers, card payments, and other non-unified arrangements by banks that aren’t convenient, instant, or affordable but allow international payments.
The existing strengths of eGIRO far outweigh the improvements that other payment methods would need. Thus, it may be operationally easier to add another feature to eGIRO than to fix the existing inefficiencies of other payment methods. With just an addition of international payment capability, eGIRO could become the most efficient payment method for all businesses in Singapore.
As more businesses start including eGIRO in their workflows, the payment system will eventually get stronger. Since most domestic businesses are already familiar with GIRO or eGIRO, expanding operations overseas would be simpler when eGIRO supports international payments. The anxiety around international payments would no longer deter them from taking the first step toward international expansion or partnership.
Further, sometimes businesses may also have to use multiple financial tools for tracking international transactions because the one they use for eGIRO may not be compatible with other payment systems. This can scatter centralization and may even increase costs.
How could this be possible?
Although regulatory considerations may slow down the introduction of international payment support to eGIRO, this feature may not be impossible to add.
PayNow-UPI is an excellent example of a cross-border payment partnership that facilitates transactions between users in Singapore and India. This was possible because both UPI and PayNow had a similar user-side procedure involving static user identifiers that allowed transactions. Despite PayNow having originated in Singapore, authorities were able to expand and merge its functionality with a foreign payment method.
A similar effort could be put in the case of eGIRO. Some overlap could be found between eGIRO and different payment methods that dominate the foreign markets. More offshore banks could be allowed the permission to offer eGIRO.
So, will this ever be possible?
The growing demand for eGIRO to support international payments may capture the attention of banks. This may lead to the development of a method that allows international transactions using eGIRO. If this becomes a reality, there would be nothing to stop eGIRO from being the epitome of a well-rounded payment system, something that a financial utopia would require.
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