MAS Chief Fintech Officer on the Future of Money: Mobile Apps, Biometrics, and a Cashless Society
OpenGov sat in on a presentation by Mr. Sopnendu Mohanty, Chief Fintech Officer, Monetary Authority of Singapore (MAS), which was given at EmTech Asia this week.
He discussed how our current methods of mobile banking, such as SMS authentication, will soon be seen as archaic and insecure. Given how technology is changing at a rapid pace and how the cyber threat landscape is growing each day, the future of money will be centered on a smarter and safer financial sector.
“Tech infrastructure is key to a smart financial centre. We strongly believe that the bank systems will be changed dramatically over the next few years,” said Mr. Mohanty.
This past July, MAS set a Smart Financial Centre strategy in motion to push fintech to the forefront. This focuses on two approaches, one of which will allow innovation support and the other will help the fintech ecosystem grow.
In 2016, the Monetary Authority of Singapore will be introducing a lot of big initiatives dealing with the Fintech space.
Mr. Mohanty was excited to announce that MAS would be one of the first regulatory agencies in the world to put a process in place to change the fintech space. Here, they would host new technology to be produced in an experimental stage, within their sandbox infrastructure.
Singapore hosts a great ecosystem for fintech development. This is due to six factors which drive MAS to invest more in fintech, including that:
- It is a One-Stop Shop for advanced industry technology,
- There is a Collaborative Mentality which really influences the way people work with each other,
- It is an inherently Experiential Environment,
- There is a Vibrant Innovation Ecosystem,
- The Strong Talent Pool of Researchers, Innovators, and Experts,
- And it is quickly becoming a hub for Exciting Events Line-Up.
To frame his talk, Mr. Mohanty explained the 9 key technologies that MAS is actively looking at. These include Digital and Mobile Payments, Authentication and Biometrics, Blockchains and Distributed Ledgers, Cloud Computing, Big Data, Learning Machines, Cyber Security, Advanced Sensors, and Flexible Platform (API).
Digital and mobile payments revolutionized banking by allowing financial transactions to be processed on the go. Around 70- 80 percent of Fintech deals within this space, Mr. Mohanty relayed to the audience.
The financial sector was one of the first to capitalise on mobile payment technology to improve their reach and service delivery.
With respect to biometrics, the reason why it must be centered on facial recognition is due to the amount of measurable traits they can look at, plus the accessibility of this technology.
“We believe that by 2020, 75 percent of transactions will be conducted through biometrics,” announced Mr. Mohanty.
It has been suggested that mobile banking service providers to build on the four biometric capabilities (face, voice iris, and fingerprint) for their platforms. This is what banks should work to integrate into their mobile platforms, enabling safe and secure two-factor authentication.
On the topic of cloud, it can seem like an insecure and unlikely space for the financial sector to embrace. During his presentation, Mr. Mohanty took the liberty to address this opinion.
“Let’s make this clear, MAS supports cloud infrastructure,” stated Mr. Mohanty, “There is a myth going around that we do not support cloud. The infrastructure has to be more efficient and services must be on the cloud so they are easier to distribute.”
If we completely transform the way we do banking and think about banking, this will disrupt the financial sector. Yet, as we move into a more digital society, we run more risk of cyber-attacks.
Banks are investing more in Cyber Security and it is predicted that the market is going to grow by $170 billion by 2020.
Future of Fintech
Fintech allows money to be pushed to the background, with less interference in our daily lives.
Our e-z link pass (payment card for Singapore public transit) will soon become a thing of the past. We will not have to worry about security of mobile payment mechanisms and will simply use wearables or alternative methods to pay for our commute.
“We are moving towards a cashless society,” said Mr. Mohanty, describing a world where we don’t have to struggle finding an ATM or bother opening our wallet to pay the dinner bill.
As part of the Smart Nation vision, Singapore must continue to integrate new ICT and push the envelope in all sectors. The financial sector would obtain far more rewards than risks, by taking on new security and data analytics solutions presented by our digital era.