Two central banks to cooperate in the area of financial innovation
The Reserve Bank of India and the State Bank of Vietnam has signed a Memorandum of Understanding (MoU) to promote cooperation in financial innovation and digital payments, including information sharing, regulatory coordination, and payment system connectivity for cross-border QR Code-based merchant payments.
The MoU, signed on 5 May, marks a forward-looking and substantive step towards strengthening bilateral cooperation in financial innovation and digital payments, with potential to enhance cross-border payment linkages and position India as a major fintech hub, the Finance Ministry said on 29 May.
With the approval of the Union Cabinet, RBI and SBV aim to deepen cooperation in areas of financial innovations and digital payments by facilitating potential joint innovation and digital payment programs and projects, including the development of connectivity in payments system to enable cross-border transactions between the two countries for QR code-based merchant payments.
The MoU is a statement of intent between RBI and SBV to cooperate in the area of financial innovation and digital payments. It is intended to provide a broad framework for collaboration, information exchange and implementation support, to the extent permitted by the applicable laws, rules and regulations governing the two Parties.
The scope of cooperation under the MoU covers, inter alia, information sharing on emerging market trends and developments, standards and best practices in digital payments and innovative technologies, regulatory frameworks pertaining to innovations, and the development and oversight of digital payments in financial services. The MoU also provides for potential joint programmes and projects, including payment system connectivity for cross-border QR Code-based merchant payments between India and Viet Nam.
The MoU is expected to enable greater efficiency in processing of cross-border transaction between two countries and make these transactions a transparent (upfront display of charges), convenient, real-time manner, and more cost-efficient. Also, facilitate trade and tourism between two countries to provide greater export opportunities to businesses in India. Fiinews.com
