IFC, MAS and ASEAN Bankers Association introduce Industry FinTech Sandbox as part of ASEAN Financial Innovation Network

Above photo: Mr. Sopnendu Mohanty, Chief FinTech Officer, MAS/ via Twitter page of Singapore FinTech Festival

The International Finance Corporation (IFC), which is a member of the World Bank Group, the Monetary Authority of Singapore (MAS) and the ASEAN Bankers Association (ABA), today introduced, an industry FinTech sandbox for financial institutions and FinTech firms as part of the ASEAN Financial Innovation Network (AFIN), at the sidelines of the 2017 Singapore FinTech Festival.

AFIN was launched in May 2017, through a memorandum of cooperation between MAS and IFC. AFIN aims to support financial services innovation and inclusion in less developed markets within the ASEAN region and to provide a platform for collaboration and innovation for financial institutions and FinTech firms.

AFIN will provide an integrated platform for collaboration between ASEAN banks, microfinance institutions, non-banking financial institutions (NBFI) and regional FinTechs. The platform will facilitate development and experimentation of innovative digital financial products and services. It will support an array of financial service functions and solutions such as customer onboarding, credit scoring, merchant payments and compliance solutions amongst others.

AFIN can help banks test out solutions in a quick and seamless manner, by providing a structured method for integration and defining relevant standards where necessary to connect the backend systems of banks and FinTechs.

Regulators across ASEAN are moving quickly to embrace FinTech innovation, while ensuring financial stability. In this context, AFIN will collaborate closely with MAS and other regulators in the region to provide a practical environment where banks and regulators can also gain better insight into the evolving impact of FinTech from key challenges such as security, data privacy and consumer protection.

Several institutions have signaled their intent to participate in a pilot phase as part of the AFIN industry sandbox, including the Unionbank of the Philippines, Yoma Bank and Wave Money in Myanmar, VP Bank in Vietnam, City Bank in Bangladesh and Commonwealth Bank Indonesia.

Preparatory efforts and research for AFIN has benefited from constructive inputs from a range of technology, FinTech and financial services providers across the region. These inputs include understanding market needs, refining the strategy and business concept and assessing feasibility and technology requirements.

Mr. Sopnendu Mohanty, Chief FinTech Officer, MAS, said, “MAS is encouraged by the strong support from the industry and regulators for the AFIN industry sandbox. The sandbox will facilitate broader adoption of FinTech innovation, and enhance financial access for a wider population. The joint platform for experimentation between banks and FinTechs gives regulators an opportunity to better understand financial innovations. This will in turn encourage policy harmonisation and partnerships that would make ASEAN an even more conducive market for businesses and investment.”

 “In emerging markets, banks and institutions have fewer resources to allocate to digital research, and need ways to experiment and integrate new solutions to broaden their services and reach the unbanked. Innovation and FI-TechFin partnering are particularly important in these markets as such partnerships can help reduce costs necessary to reach the unbanked and underbanked populations,” said Mr. Vivek Pathak, IFC’s Director for the East Asia and the Pacific,

“AFIN has the potential to create and open up new markets by supporting and accelerating the digital transformation of financial services, and providing a responsible, organized approach from a regulatory perspective. We are glad to have ABA and MAS as founding partners in this initiative, and are looking forward to having more interested banks and FinTechs participate in AFIN,” he added.

“This initiative aligns with our goals to promote the ASEAN Economic Community benefits, enhance the active collaboration of ASEAN banking institutions, and promote best-in-class banking practices among our member countries,” commented Mr. Paul Gwee Choon Guan, Secretary-General, ASEAN Bankers Association. “We are pleased to support, engage and collaborate with MAS and IFC to accelerate FinTech innovation and development in the region.”

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