NEW ELECTONIC DEFFERED PAYMENT METHODS
ABS, together with the seven Domestic Systemically Important Banks (D-SIBs), will launch two new e-payment methods, EDP and EDP+, in mid-2025.
The D-SIBs are Citibank, DBS Bank, HSBC, Maybank, OCBC Singapore, Standard Chartered Bank and UOB.
EDP and EDP+ are meant to “address the use cases of post-dated payments and transactions requiring greater certainty of payment respectively”, said MAS and ABS.
They added that the main difference between EDP and EDP+ lies in when funds are deducted from the payer’s account. For EDP, funds are deducted upon presentment by the payee, while for EDP+, funds are deducted immediately upon issuance.
Both will leverage PayNow to allow payers to identify payees when making payments, and will be accessible via digital banking platforms.
Both modes will also be valid for six months from the effective date, similar to cheques and cashier’s orders, which are cheques issued by banks themselves.
The two e-payment methods will offer enhanced features, including digital notifications to both payer and payee at the various transaction stages – issuance, presentment, expiration and cancellation.
MOVING AWAY FROM CHEQUE USAGE
MAS had issued a consultation paper in November 2022, which proposed a roadmap to end the use of cheques here in Singapore.
This comes amid decreasing cheque usage by both corporates and individuals in Singapore, in favour of e-payment solutions.
Annual cheque transaction volume had fallen by about 80 per cent from 61 million in 2016 to less than 14 million in 2023, said MAS and ABS.
The share of Singdollar-denominated cheque transaction volume as a proportion of payments using Fast and Secure Transfers (“FAST”), Inter-bank GIRO and cheques has decreased from 32 per cent in 2016 to less than 4 per cent in 2023.
MAS and ABS added that retail cheques will continue to be available, as well as cashier’s orders and USD cheques for both corporate and retail customers.
Major retail banks in Singapore will also continue to waive cheque service fees for seniors.
Interested parties are invited to submit their feedback on a public consultation paper detailing the transition plan from cheques to e-payments by Jan 17, 2025.
