Asia-Pacific's Real-Time Payment Rails Are Going Cross-Border — and Governance Is the Hard Part

Asia-Pacific's Real-Time Payment Rails Turn Outward

The story of real-time payments in Asia-Pacific has, for most of the past decade, been a domestic one. Central banks built national instant-payment infrastructure — India's Unified Payments Interface, Singapore's PayNow, Thailand's PromptPay, the Philippines' InstaPay — optimised to move money quickly within borders. The next chapter, now visibly under way, is about connecting those rails to one another.

That shift matters because the region accounts for a disproportionate share of global remittance flows, intra-regional trade and migrant-worker corridors. Legacy correspondent-banking routes serving those flows remain slow and expensive relative to what domestic real-time systems can deliver. The logic of extending instant-payment infrastructure across borders is therefore both commercially obvious and politically attractive to governments keen to reduce dependence on dollar-clearing intermediaries.

Two Models, One Direction

Broadly speaking, the region is pursuing interoperability through two distinct architectural approaches, and both are advancing simultaneously.

The first is the bilateral linkage model, in which two countries connect their domestic payment rails through a direct technical and governance bridge. The PayNow-UPI link between Singapore and India, live since February 2023, is the clearest example and has served as a proof-of-concept for the wider region. Similar bilateral arrangements — connecting Thailand, Malaysia, Indonesia, the Philippines and Singapore in various pairings — have been announced or activated over recent years, with the Monetary Authority of Singapore playing a particularly active convening role.

The second model is multilateral or hub-and-spoke architecture, which avoids the combinatorial complexity of building a separate bilateral link between every pair of countries. Under this approach, participating national systems connect once to a shared platform or rulebook, and interoperability follows automatically with every other participant. The Bank for International Settlements' Project Nexus has been the most prominent multilateral initiative in the region, with India's NPCI, the central banks of Malaysia, the Philippines, Singapore and Thailand all named as participants in earlier phases of the project.

The bilateral model proves the concept; the multilateral model is where the real scaling happens — and that is where the hard governance work lies.

Why Governance Is the Real Bottleneck

Technology is arguably the easier part of this problem. The harder challenge is harmonising the legal, compliance and liability frameworks that sit beneath the technical plumbing. When a payment crosses from one jurisdiction to another, questions immediately arise: Which country's anti-money-laundering rules apply? Who bears liability if a transaction fails or is fraudulent? How are foreign-exchange conversions handled at the point of initiation versus settlement?

Different central banks have answered these questions in different ways for their domestic systems, and reconciling those differences for cross-border use requires protracted bilateral or multilateral negotiation. Regulatory capacity constraints — particularly in smaller ASEAN economies — can slow that process considerably.

There is also the question of commercial incentives. Domestic real-time payment networks in the region were often built as public infrastructure with low or zero transaction fees by design. Cross-border extensions introduce foreign-exchange spread, correspondent-bank settlement and compliance overhead that must be recovered somewhere. Getting banks and payment service providers to actively promote cross-border instant payment products — rather than defaulting to legacy wire transfers that carry higher margins — requires either regulatory pressure or clear commercial upside.

What to Watch

Several developments will be worth tracking in the near term. Project Nexus has been moving from pilot to production, and the terms under which initial live transactions are processed will reveal how the governance questions above have been resolved in practice. Any expansion of the participant list beyond the original five central banks would signal growing confidence in the model.

Separately, the continued build-out of bilateral links across ASEAN — particularly into markets with large outbound remittance volumes such as Vietnam and Indonesia — will test whether the bilateral model can scale before multilateral alternatives are ready.

For European fintech observers, the APAC experience is directly relevant. The European Payments Initiative and ongoing work on instant-payment interoperability within the EU face structurally similar tensions between national infrastructure sovereignty and the efficiency gains from genuine cross-border connectivity. Asia-Pacific is running the experiment first, and the results — on governance design as much as technology — will carry lessons well beyond the region.

Editorial note: This article draws on publicly available information about regional payment infrastructure initiatives. Specific figures, transaction volumes and regulatory timelines cited in third-party reports have not been independently verified against primary central-bank sources and are therefore not reproduced here.