The payments landscape across Asia-Pacific (APAC) is entering a defining phase. Rapid adoption of real-time payments, the emergence of cross-border interoperability models, and growing interest in digital money are reshaping how value moves across the region.
In this conversation, Arun Kini, Managing Director for Payments APAC in Finastra, shares his perspective on how APAC is evolving, why it is structurally distinct from Western markets, and what it will take for banks to build truly future-ready payment ecosystems.
How is the payments landscape across APAC evolving, and what structurally differentiates the region from Europe and the U.S. in terms of adoption, regulation, and scale?
APAC is structurally different from the U.S. and Europe due to its fragmented landscape of domestic payment schemes across countries, rather than a unified system like SEPA in Europe or a homogeneous U.S. market.
This fragmentation has driven innovation at the country level, with multiple domestic real-time payment systems emerging across the region.
Increasingly, these systems are being linked through both domestic and multilateral initiatives such as Nexus, which enable real-time cross-border payments.
Adoption of real-time payments has been significantly stronger in APAC.
A key driver is that many markets transitioned directly from cash-heavy economies to digital payments, especially in Southeast Asia.
Innovations such as QR-code-based payments, account-to-account transfers, and cross-border extensions of systems like UPI have accelerated usage.
Additionally, payments innovation in APAC has often been driven by practical needs, including financial inclusion, enabling cross-border usage for travelers, and supporting underserved populations.
As real time payment use cases accelerate across APAC, how are expectations shifting for corporates, consumers, and merchants and where are those expectations most challenging to meet?
Real-time payments initially gained traction in retail, but success there has shifted expectations across all segments.
SMEs now use them for working capital management, while corporates increasingly leverage them for supplier payments and payroll, supported by rising transaction limits.
The overarching shift is toward instant everything: across consumers, corporates, and merchants.
At the point of sale, there is a clear move away from cards toward account-to-account and QR-based payments, driven by lower merchant costs (LowerMDR versus cards) and improved conversion rates.
The challenges for banks are two-fold. One is the ability to meet customer expectations to extend the same experience to cross-border transactions because of a lack of interoperability, managing compliance within the SLA’s, etc. and two, the pressure on revenues as customer expectation is for Real Time Payments to be cost effective (or free) following the experience of domestic schemes.
Real time cross border payments today are largely built through bilateral links. What role can APAC play in moving beyond this model, and what still needs to change to deliver true scale and last mile value to customers?
APAC is already leading this shift. While cross-border real-time payments have traditionally relied on bilateral links, initiatives like Nexus are enabling multilateral interoperability, connecting multiple national systems into a unified framework.
India, Indonesia, Singapore, Malaysia, Thailand, and Philippines: six countries coming together to interlink their domestic real-time payment schemes to actually make it a multilateral real-time payment scheme. That change is already happening.
This model is influencing other regions to adopt similar approaches or integrate with emerging networks.
However, key challenges remain:
● Legacy Infrastructure – Banks participating in domestic real time schemes did so by building capabilities around existing legacy infrastructure which were designed primarily for batch processing.
● Liquidity Management – With volume surges happening outside of traditional clearing hours due to varied use cases (e.g., eCommerce), banks need to be able to predict and manage their liquidity positions.
● And taking this cross-border also brings in an added aspect around FX and Compliance.
This is driving banks to rethink their payments strategy and look at investing in modern payment hubs.
Stablecoins are gaining significant attention in payments and settlement. Where do you see the real gap today between market hype and what is practically achievable within regulated payment ecosystems?
Stablecoins are gaining traction, supported by pilots and industry initiatives, but they remain less mature than regulated payment systems.
The primary gap is interoperability. Existing stablecoin ecosystems tend to operate in silos, without the level of interconnection seen in traditional payment networks.
While adoption is expected to grow in the coming years, regulated multilateral payment networks are currently scaling faster, especially as new cross-border frameworks emerge in regions such as ASEAN, the Middle East, and Africa.
AI is increasingly being applied within core payments operations. Where is it delivering the most tangible value today?
AI is currently delivering the most value in payments operations and processing efficiency, rather than core transaction decision-making.
Key use cases include:
● Improving transaction repair processes
● Enhancing customer support handling
There is also emerging potential in areas like:
● Agentic AI for transaction initiation
● Automated exception handling and repair
● Routing decisions
However, the industry is not yet ready for fully autonomous AI in payments. Human oversight remains critical, especially for risk and compliance-sensitive processes.
From your experience, what architectural and strategic priorities should bank CIOs focus on to build a future-ready payments ecosystem: one that can coexist with traditional rails, real time payments, and emerging forms of digital money?
Banks need to move away from siloed payment systems toward more centralised, hub-based architectures that can support multiple payment types and geographies from a single engine.
Key priorities include:
Key priorities include three broad areas.
● Architecture modernisation means adopting cloud-native and containerised infrastructure, improving resilience and uptime, and simplifying integration to reduce operational complexity.
● API and ecosystem enablement requires banks to support embedded finance through APIs and microservices while managing external integrations more efficiently.
● Future-proofing means designing adaptable platforms that can support real-time payments, stablecoins, CBDCs and other emerging digital money models, while avoiding repeated rearchitecting as new payment rails emerge.
Overall, the focus is on building a flexible, unified, and forward-compatible ecosystem that can evolve alongside the payments landscape.
As APAC continues to redefine how money moves, its blend of innovation, scale, and pragmatic execution will shape the next era of global payments.
The real opportunity now lies in turning fragmented progress into seamless, interoperable ecosystems that deliver consistent value across borders.
For banks, the path forward is clear: modernise decisively or risk falling behind in a world that increasingly runs in real time.
Featured image: Edited by Fintech News Singapore, based on image by ismode via Magnific
