Singapore sees more investments pouring into financial technology firms this year as the city-state seeks to become a regional hub for capital raising in areas from payments to robo-advisory, according to a top central bank official.
Such investments have risen from around $20 million in 2014 to a record $1.1 billion last year, and more is expected this year, Sopnendu Mohanty, the Monetary Authority of Singapore’s (MAS) chief fintech officer, said in an interview.
"We don’t have Silicon Valley, but we are trying our best,” he said. The environment the country is building enables these fintech players to "find opportunities to see if their early ideas translate into real value in the long run.”
Mohanty, who spent 17 years at Citigroup Inc. before taking the position at the central bank in 2015, is in the fintech role at a time when the industry is fast evolving. The MAS’ aspirations are central to Singapore’s aim to fortify its position as a global financial center where incumbent banks and contesting tech firms compete to provide services to consumers and corporates, though it is also a gatekeeper of standards as companies roll out their businesses.
Mohanty has been involved with efforts like Partior — the joint venture between JPMorgan Chase & Co., Temasek Holdings Pte. and DBS Group Holdings Ltd. — that’s a new blockchain-based platform for payments, trade and foreign-exchange settlement. He is also keen to expand a cross-border payments infrastructure, that has kicked off with Thailand allowing people in both countries to almost immediately move money via their mobile phones through government-backed systems.
Money transfers, licenses
With the Thailand link now established, India is a focus, Mohanty said. Other countries in Southeast Asia like Malaysia and Indonesia may follow, as well as countries further afield like Africa.
"We hope India comes into this platform within next year,” he said. "If we can connect our system with India’s — we have done a huge test of our system — we hope other countries will also follow onto this platform.”
Meanwhile, the MAS is still processing the applications of companies seeking licenses to operate services in payments and crypto-exchanges in the city, Mohanty said. These companies have been operating under a grace period since the regulator made the new Payment Services Act effective in January 2020. More than 300 have applied, and the MAS is reviewing how best to speed up the process as well as balance between encouraging entrepreneurship and regulation, according to a Singapore minister in January this year.
Among the prominent firms seeking the MAS licenses are entities of Alibaba Group Holdings Ltd. and Ant Group, Binance Holdings Ltd., as well as Alphabet Inc.
"Giving licenses to somebody is a premium, it is not something to be taken lightly,” Mohanty said, without giving a timeline for when the first license would be issued. "We are ensuring that whoever gets an MAS license will be credible.”
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