The financial technology industry, or Fintech, is strongly supported by the Monetary Authority of Singapore. The MAS doesn’t need to choose between fintech and financial institutions when it comes to offering financial support.
Supporting the Economy
According to Ong Ye Kung, Education Minister and the Second Defense Minister, both new and established players in the economy are encouraged to collaborate, compete and innovate. Kung’s positive remark was in response to Melvin Ong on behalf of Tharman Shanmugaratnam, the minister in charge of MAS.
Supposedly, the 73% of financial institutions that receive support from MAS are concerned they risk losing financial support as they have to compete with new businesses in the financial technology industry. According to the minister, fintech is having an unprecedented effect on the country’s financial services. These fintech players stand to take over the businesses previously held by financial institutions or, even, work together with FI’s.
Time will tell if FI’s and fintech can partner together. However, FI’s are making their moves and are even investing in the development of their own fintech services and capabilities. MAS has been and will continue to be a strong supporter of those in fintech as the Singapore central bank is one of the most progressive regulators when it comes to supporting new industries.
As centers for innovation, fintech allow financial institutions opportunities to strengthen product offerings while collaborating alongside financial institutions allows fintech players to have a wider reach. MAS promotes fintech actively by regularly updating policies and insuring the Singaporean economy is welcome to innovation.
In an example of supporting both fintech and financial institutions, MAS provided financial institutions with guidelines for the use of cloud computing in order to convince these financial institutions to seek out fintech solutions that were hosted through the cloud. Additionally, MAS has enacted a regulatory sandbox for the financial institutions as well as fintech players to innovate and experiment with new technology, while having the potential consequence of product failure limited.
Innovating with Financial Institutions
Ong points out that it is important for both financial institutions and fintech players to innovate and develop together. Ong points out the over 20 financial institutions worldwide have set up research centers and innovation labs in the fields of machine learning, design thinking, user experience, data science and more.
When it comes to providing a workforce for these new industries, Ong points out that education is key. MAS is closely working with institutions of higher learning in order to develop new curriculum in order to better align what is taught in institutions with the required skills for the financial industry. The industry recognizes its own need for upgraded skills and is in full support of more tailored curriculums.
For those already in the field, the Financial IT Academy offers various programming and resources to further develop the skills of mid-career professionals. Likewise, the Institute of Banking and Finance will offer leaning modules for human centric design, data science, cyber security awareness and more.
As the future quickly approaches, it pays to be a supporter of innovation. With fintech and financial institutions working alongside each other, the future is bright.