Singapore fintech changes up a gear

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On 1 December 2016, the Monetary Authority of Singapore (MAS), together with the Financial Services Sharing and Analysis Centre (FS-ISAC) jointly announced that they will be working together to establish an APAC Regional Intelligence and Analysis Centre to promote sharing and analysis of cybersecurity information within the financial services sector on a regional basis. The APAC Regional Intelligence and Analysis Centre is to be based in Singapore and expected to be operational in the first half of this year.

This comes shortly after the opening speech by Ravi Menon, managing director of the MAS, at the inaugural Singapore fintech festival last November, in which he announced the collaboration between the FS-ISAC and the MAS to start the centre as a part of Singapore’s fintech agenda to strengthen cybersecurity. He also said that this collaboration would serve to deepen the capabilities of the local cybersecurity community, as well as help the financial industry to better monitor cyber threats and provide intelligence support.

In addition to strengthening cyber-security capability, Menon said that a part of the fintech agenda was to facilitate the infrastructure for an innovation ecosystem. Recent initiatives are:

  • Establishing physical spaces for collaboration and experimentation, such as LATTICE80, Singapore’s first fintech innovation village for fintech start-ups to work, connect and co-create with the financial industry and venture capital investors;
  • Developing infrastructure for electronic payments such as the Central Addressing Scheme (CAS) and the Unified Point-of-Sale (UPOS), which the Association of Banks of Singapore is working on to make electronic payments seamless and convenient;
  • The MAS partnering with the Ministry of Finance and GovTech to create a national “know-your-customer” (KYC) utility to streamline the KYC process;
  • The MAS, Singapore Exchange and eight banks working with R3 blockchain research lab and BCS Information systems to use blockchain technology for cross-border inter-bank payments;
  • The MAS aiming to create an API (application program interface) economy, and actively pushing financial institutions to develop and adopt APIs to offer as many as possible to the broader community. The MAS and Association of Banks in Singapore (ABS) will also be publishing the Finance-as-a Service API Playbook to provide guidance on common and useful APIs that financial institutions can make available.

In terms of fintech regulation, while it was good to hear that the regulators do not intend to stifle innovation, it was clear that the MAS does intend to monitor new innovations closely and calibrate appropriate regulatory responses accordingly. The MAS has now issued the finalized regulatory sandbox guidelines. Its is also expected that sometime in the future a consultation paper from the MAS on the governance and management of automated, algorithm-based digital advice on finance or investment services by robo-advisers, and further guidance on the online distribution of life insurance products.

Business Law Digest is compiled with the assistance of BAKER MCKENZIE. Readers should not act on this information without seeking professional legal advice. You can contact Baker & McKenzie by e-mailing Danian Zhang at danian.zhang@bakermckenzie.com, or for general enquiries contact Anand Ramaswamy at anand.ramaswamy@bakermckenzie.com

Additional copy regarding new treaties with India was compiled by Nishith Desai Associates (NDA), a research-based international law firm with offices in Mumbai, New Delhi, Bangalore, Singapore, Silicon Valley and Munich.