After Thailand, Malaysia's Turn to Receive Payments with QRIS

Bank Indonesia (BI) has expanded the QRIS cooperation between countries with Bank Negara Malaysia (BNM), marked by the launch of a trial of inter-country payment interconnection using a QR Code between Malaysia and Indonesia.

Previous, in mid 2021 BI has conducted trials with Thai regulators to implement full commercial inter-country QRIS in the first quarter of 2022.

This initiative was carried out thanks to the collaboration of various stakeholders from both countries under the joint supervision of BI and BNM, namely the Indonesian Payment System Association (ASPI), RAJA (Rintis, Artajasa, Jalin, Alto), and Payments Network Malaysia Sdn Bhd (PayNet) as switching. Then, the settlement banks, namely Bank Mandiri, BNI, CIMB Bank Berhad, as well as other trial participants who are Payment Service Providers, both banks and non-banks from both countries.

BI Deputy Governor Doni P Joewono said through this initiative, people in Indonesia and Malaysia can make retail payments using the QR Code for national payments in Indonesia, namely QRIS or QR Code Payment Malaysia, namely DuitNow, at offline and online merchants.

This collaboration begins with the pilot phase and is heading towards the launch of a fully commercial phase in the third quarter of 2022. "This cooperation will be expanded in the future and support real-time interstate money transfers between Indonesia and Malaysia," he said in an official statement, Thursday. (27/1).

Furthermore, he said this initiative is a form of implementation of the Indonesia Payment System Blueprint 2025. On the other hand, Bank Indonesia recognize the importance of interconnection of payments between countries and will continue to expand the initiative. The goal is to provide convenience and expand payment options for people in both countries.

“Ultimately, it aims to improve transaction efficiency, support the digitization of trade and investment, and strengthen macroeconomic stability by promoting the wider use of Local Currency Settlement (LCS).”

Use direct quotations Local currency exchange rates provided by Appointed Cross Currency Dealer (ACCD) banks under the LCS framework will increase transaction efficiency, resulting in lower transaction costs. In other words, customers still use Rupiah with the QR system even though they are abroad. They can save because there are no more fees and commissions, such as exchange fees.

Meanwhile, BNM Deputy Governor Jessica Chew Cheng Lian said, the interconnection of QR Code payments between countries marks an important milestone in the long history of collaboration between Indonesia and Malaysia.

"This development is a major step towards realizing the vision of creating a fast and efficient retail payment system network in ASEAN, which will ultimately accelerate digital transformation and financial integration for the benefit of individuals and businesses," said Jessica.

The realization of the QR Code interconnection and interoperability of national payments between Indonesia and Malaysia is a new milestone in facilitating the activities of the people of the two countries, especially for tourists. Indonesia and Malaysia recorded the number of travelers with an average of 5,6 million arrivals annually before the pandemic.

Also, in line with the priority agenda of the Indonesian G20 Presidency regarding the Cross-border Payments Roadmap in an effort to maintain the momentum that was initiated since the two previous G20 Presidencies to address the challenges of inter-country payments.

Separately, Bank Indonesia Governor Perry Warjiyo said BI would explore Singapore and Saudi Arabia for the expansion of QRIS between countries. “We have also started cooperation with Thailand, Malaysia and possibly also with Singapore and Saudi. We will continue to expand QRIS cooperation," he said in a working meeting for Commission XI of the DPR RI, citing: CNBC Indonesia.

Domestic QRIS transactions

In the domestic market, Bank Indonesia recorded a value of QRIS transactions reached Rp23 trillion from January 1 to December 14, 2021. This realization came from 316 million transactions in the same period. In terms of users, it is said that it has reached more than 13 million merchants, exceeding the initial target of 12 million merchants, the majority of whom are MSMEs.

This year, BI will continue to develop the QRIS feature. One of them is the expansion of the provision of QR Codes for buyers or customer presented mode (CPM). Previously, QR Codes were provided by merchants or merchant presented mode (MPM).

Next, QRIS can be used by users not only for money transfers, but can also be used when withdrawing and depositing cash, as well as increasing the maximum QRIS transaction ceiling from IDR 2 million to IDR 5 million, the aim is to increase transactions at medium and large merchants in shopping centers.