Payment leaders push for seamless integration to boost SME cash flow
The Importance of Regulatory Frameworks in Modern Payments
In today's fast-paced digital economy, the need for a robust regulatory framework has become increasingly vital to ensure seamless and efficient payment systems. Bridging the gap between traditional and digital financial services requires not only technological innovation but also a structured approach that ensures finality in transactions. This is especially crucial for small and medium-sized enterprises (SMEs), which often face operational bottlenecks that cost them both time and money.
Major payment and banking institutions are now focusing on digital interoperability and new technologies to address these challenges directly. By leveraging real-time payment (RTP) solutions, these organizations aim to streamline operations and provide SMEs with faster and more transparent financial services.
Real-Time Payment Success in Thailand
Helena Forest, EVP for Real Time Payments Product and Commercial at Mastercard, emphasized the success of RTP technology in Thailand. She highlighted that Mastercard's RTP system now operates in 12 economies globally and has brought over 8 million SMEs into the digital payment space in Thailand alone. This achievement is being hailed as an "incredible success story" in the region.
Mastercard’s design philosophy is centered around interoperability, which involves collaboration with direct competitors to establish global standards. This effort ensures trust and widespread adoption of payment technologies across different markets. During a panel discussion at the Singapore Fintech Festival 2025, Forest underscored the importance of such collaborations in achieving scalability and reliability in financial systems.
UnionPay's Strategy for Enhanced Transparency
UnionPay International is also making significant strides in improving payment transparency and speed. Au Chong Wei, Senior Head of Regional Innovative Product at UnionPay International, explained that the company is transitioning from a card scheme model to a platform-based approach. This shift aims to foster stronger ecosystem connections and enhance the overall user experience.
One of UnionPay's key initiatives is the "Silk Road initiative," which involves a collaboration with a Shanghai regulator. This project seeks to integrate taxation and customs systems to reduce processing times for SME trade. According to research, 75% of SMEs face delayed payments, and this initiative aims to address that issue by reducing clearance and payment cycles to just one to two days.
Transforming the Middle East's Regulatory Landscape
In the Middle East, the regulatory landscape is undergoing significant transformation to accelerate SME inclusion. Amit Malhotra, Global Head of Retail Banking at Abu Dhabi Islamic Bank (ADIB), shared insights on how the UAE is leading this change. He noted that the country has over 25 licensing authorities, and a major shift has been the use of Blockchain for Know Your Business (KYB) processes. This innovation allows SMEs to open accounts in seconds or minutes, significantly streamlining the onboarding process.
The UAE's new national payment scheme mandates 24/7 instant payments across the entire SME ecosystem. Malhotra projected that the next 12 to 18 months will see a transition from proofs-of-concept (POCs) to real-world applications. Potential use cases include AI-driven instant credit and Blockchain-based cross-border payments.
Addressing the Challenges Faced by SMEs
Milind Sanghavi, Founder and CEO at XWeave.io, highlighted another critical issue facing SMEs: the lack of adequate banking services. He described many SMEs as “crappily banked,” citing a personal example where a fund transfer cost a startup 65 basis points (bips).
Sanghavi emphasized that bridging this gap requires a strong regulatory framework that ensures payment finality, where the exact amount is reflected to the second decimal. He concluded that cooperation among industry players, which has historically been 85% partnership, must now extend to the institutional and digital asset worlds. This expansion will be essential in unlocking long-term commercial success for SMEs.
Conclusion
As the financial landscape continues to evolve, the role of regulatory frameworks, technological innovation, and industry collaboration becomes increasingly important. By addressing the unique challenges faced by SMEs, stakeholders can create a more inclusive and efficient payment ecosystem that supports growth and sustainability in the digital age.
