How PayNow Gen2 is rewriting Singapore’s digital infrastructure

Singapore is preparing the next generation of its real-time payments infrastructure. The Monetary Authority of Singapore (MAS) and the Association of Banks in Singapore (ABS) have launched a joint study to develop PayNow Gen2. According to the recently released PayNow Generation 2 – Phase 1 Report, the initiative is designed to make digital payments faster, more seamless, and more secure for both consumers and businesses. The study focuses on four priorities: improving the user experience, increasing system scalability, enhancing interoperability, and strengthening security. MAS aims to publish a public roadmap and begin a live pilot by the end of 2026, reflecting the growing role of instant payments as a key part of Singapore’s digital infrastructure.

PayNow is already widely used for person-to-person transfers and QR code payments at physical stores through SGQR. However, the online payment experience remains less convenient. In many cases, customers need to save a merchant’s QR code, open their banking app, and upload the image before they can complete the transaction. These extra steps add friction to the checkout process and can lead to abandoned purchases.

PayNow Gen2 is expected to address this issue by introducing standardized QR code deep linking. Instead of manually handling QR codes, customers will be able to tap a payment button that automatically opens their preferred banking app or digital wallet with the transaction details already populated. A smoother checkout experience could help online merchants reduce cart abandonment. At the same time, PayNow’s low-cost domestic payment infrastructure may allow businesses to lower payment processing costs by relying less on international card networks, improving overall profitability.

The upgrade also has broader strategic importance. Across Southeast Asia, countries such as Malaysia and Indonesia have expanded their real-time payment systems through DuitNow and QRIS, while cross-border QR payment links within ASEAN continue to grow. As regional payment networks become increasingly interconnected, Singapore needs to ensure its domestic infrastructure remains compatible with these developments. PayNow Gen2 is intended to provide a more scalable and interoperable platform that supports regional integration while reinforcing Singapore’s position as a leading digital financial hub for ASEAN.

The changes could also reshape competition in the fintech sector. Many private payment providers and e-wallet operators initially gained traction by offering a simpler and more convenient experience than traditional bank transfers. If PayNow delivers the same level of convenience through the national payment infrastructure, those firms may need to differentiate themselves in other ways. As noted in a recent MAS Speech, maintaining a modern and competitive payment system is essential to Singapore’s connectivity with the global economy. Rather than competing on payment functionality alone, fintech companies are likely to focus more on value-added services such as loyalty programmes, embedded finance, and AI-powered financial tools, shifting competition from payment processing to broader financial ecosystems.