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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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