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The Reserve Bank of India (RBI) Deputy Governor T Rabi Sankar said the current correspondent banking system cannot make cross-border payments cheaper despite the advancement in technology, and policymakers will have to show “willingness” to make it happen.

Regretting that commissions of over 6% are charged in retail cross-border payments, Sankar said the current banking correspondent-based system cannot yield success on this front.

Countries have a robust domestic payments system, such as the unified payments interface (UPI) in the Indian context, which makes it technologically possible to make cross-border payments seamless and cheap, Sankar said, speaking at the Global Fintech Fest in Mumbai.

“I think it is a question of willingness. It’s not a question of lack of knowledge or lack of technology. And it’s a question of commitment of policymakers across the globe, that we need to find a solution, and you should be open enough to look for the solutions outside the existing correspondent banking system,” he said.

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Sankar also said that the best way for the fintech industry to function will be the establishment of a robust self-regulatory organisation.

He said fintech firms should focus on coming out with products and services that are beneficial to society, address a felt need, and do their business responsibly.

Sankar said innovation holds immense promise and pitched for a balanced evolution where innovation is responsible and inclusive.