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Singapore's fintech ecosystem and its role in Asean

The Singapore FinTech Association looks at Singapore's fintech journey to be a world-leading hub.

The Singapore FinTech Association held its first Singapore FinTech Awards event this year.

SINGAPORE'S fintech ecosystem has grown by leaps and bounds since the Monetary Authority of Singapore (MAS) kickstarted the fintech journey four years ago. The current success is not by accident, but a confluence of carefully planned interplay between capital, talent, market access and progressive regulations, leading to a vibrant fintech community working hard to propel Singapore to be the world's leading fintech hub.

In the driving seat

Evolution and growth of the fintech industry is key for Singapore to continue as a major international financial centre and to promote the financial services sector, which contributes to about 13 per cent of Singapore's GDP and employs about 200,000 workers.

All the top international financial centres such as New York and London are also leading fintech capitals. MAS has played a key role in promoting the growth of the fintech sector and continues to do so, under the thesis that a Smart Nation needs a Smart Financial Centre, whereby technology is used pervasively to drive efficiency gains, manage risks better, create business opportunities and improve people's lives.

Key to all these is a regulatory approach that encourages experimentation while ensuring risk management safeguards are in place, and that any new regulations should be in response to material risks and be proportionate in magnitude.

Policies such as the regulatory sandbox and sandbox express, outsourcing and cloud computing guidelines and the recent notice on cyber hygiene are fine examples of this progressive regulatory approach.


The banks were one of the very first stakeholders to start using fintech to drive efficiencies and adapt new technologies, through a myriad innovation labs to dedicated innovation and digital teams.

Notable examples include The FinLab from UOB and The Open Vault at OCBC. Accelerators such as the Startup Bootcamp played a major role in the initial years to facilitate collaborations between financial institutions and the fintech startups.

2016 was a watershed year as key drivers were set in motion, including the setting up of the world's largest fintech co-working space 80RR FinTech Hub, the Singapore FinTech Association as a non-profit platform to facilitate collaborations among ecosystem participants and most importantly, the Singapore FinTech Festival, which immediately catapulted Singapore to the world stage as Asia's leading fintech capital and is now the world's largest fintech festival.

Global connectivity

Given Singapore's small market size of 5.6 million population but with an outsized presence of more than 200 banks, naturally many of the fintech firms gravitate towards business-to-business offerings and looking at markets beyond Singapore. One example is MoneyThor, which started in 2013 with a team of two, and provides data analytics solutions to financial institutions. Today, they are a team of 20 spread across four countries with deployments of their solutions in 14 countries, including Digibank in India by DBS Bank.

Our strategic geographical proximity to Asean, where all 10 Asean nations are within reach by four-hours flights, makes Asean a natural economic hinterland, especially with the huge market size of 640 million population, of which more than half do not even have a bank account.

These countries are sparsely populated in their rural areas, where traditional banking infrastructure such as ATMs and branches are not cost effective, worsened by lack of proper identity documents among the citizens and almost non-existent credit reporting systems in most countries.

This is where the biggest opportunity is - that is, to solve the issue of financial inclusion through fintech, from digital wallets for mobile payments to micro-lending.

Today, 40 per cent of fintech firms in Asean are based in Singapore, reflecting the attractiveness of Singapore as a home base and gateway to Asean.

But beyond Asean, China is an extremely attractive market, both for consumption of fintech services given its fast growing middle income class and as a market to source for innovation and technological talents (given that it produces more than half of Asia's STEM graduates).

India, with its 1.34 billion of largely young population, is also a frontier market that will be a significant force in the next five to 10 years.

In this regard, MAS has inked more than two dozen government-to-government cooperative agreements and the Singapore FinTech Association has built fintech bridges in 35 countries, to facilitate fintech collaborations and market access from and through Singapore.


There are now more than 600 fintech firms in Singapore, compared with less than 100 of them in 2016. Banks and insurance companies are in various stages of their digital transformation journey, and more than 30 of them have their innovation labs in Singapore.

On the talent front, 1,000 fintech jobs are expected to be created every year and the various stakeholders from the institutes of higher learning to non-profits such as NTUC, SFA and the Institute of Banking & Finance are collaborating to upskill and reskill financial sector workers and build the future pipeline of fintech talent.

Fintech investments quadrupled to US$453 million in the first half of 2019, placing Singapore just behind China and India in the Asia-Pacific region. Singapore's journey to be a smart financial centre is an ongoing one.

As Ravi Menon, the MAS managing director said during the recent Singapore FinTech Awards 2019: "The day we say we are a smart financial centre, we are finished, because that's complacency. This is a work-in-progress, we need to continually get smarter and smarter."

This writer is founding president of the Singapore FinTech Association (SFA), a cross-industry non-profit organisation set up to support the growth of the FinTech ecosystem. SFA has more than 350 corporate members and has established international partnerships in 35 countries.

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