Above image credit: MAS
The Monetary Authority of Singapore (MAS) today released the industry transformation map (ITM) for financial services. It outlines growth strategies by business lines, programmes for upgrading skills, and an agenda for continuous innovation and technology adoption.
Speaking at the launch of the ITM, Mr. Ong Ye Kung, Minister for Education (Higher Education and Skills) and MAS Board Member, described MAS’ vision for Singapore to be a leading global financial centre in Asia – one that connects global markets, supports Asia’s development, and serves Singapore’s economy.
The ITM was drawn up by MAS in close consultation with the financial industry and the tripartite movement (industry associations, labour movement, and government). It takes into consideration the technological disruption in the production, delivery and consumption of financial services and aims to achieve growth in financial sector real value-added of 4.3% and productivity of 2.4% annually, faster than the overall economy. The ITM also aims to create 3,000 net jobs in financial services, and an additional 1,000 net jobs in the FinTech sector annually.
The ITM aims to make Singapore aims a leading international wealth management hub. MAS is working with the industry to develop Singapore into a centre of excellence for wealth management technology and innovation, and deepen the talent. MAS is also leveraging on its external fund management programme to anchor deeper asset management capabilities in Singapore and working with the industry to position Singapore as a regional fund domiciliation hub through the Singapore Variable Capital Company framework. Singapore is currently the third largest FX centre globally. With Asia expected to attract a larger share of global investment flows, MAS will encourage key FX players to anchor their matching and pricing engines here.
To support Asia’s development, MAS is working with the industry to develop Singapore as an Asian centre for capital raising and enterprise financing, as a full service Asian infrastructure financing hub, a leading centre for Asian fixed income and a global capital for Asian insurance and risk transfer.
MAS is working with the industry to transform the insurance marketplace through centralised blockchain platforms which will allow for more efficient risk placements, and create specialist insurance solutions to address emerging risks in the region. Innovation and Regulation.
A key focus of the ITM will be to facilitate pervasive innovation in the financial sector and encourage the adoption of technology for increasing efficiency and creating opportunity. Towards this objective, MAS plans to step up efforts to encourage financial institutions to enhance connectivity and FinTech innovation through Application Programming Interfaces (APIs).
MAS will also collaborate with financial institutions to create common utilities, such as for electronic payments, digital ID, and electronic know-your-client checks.
In his speech, Mr. Ong talked about MAS working with the banking industry to launch FAST, three years ago, to conduct direct real-time transfers between bank accounts. This year, the banks launched PayNow, which links bank accounts to NRIC or mobile numbers, making transfers more convenient. PayNow is supposed to activate the full potential of FAST. It currently works only for P2P, but will be progressively expanded for P2B and B2B next year, Mr. Ong revealed. To further facilitate this, a common QR code will be introduced by the end of the year, that can accept all payments using QR readers
MAS will facilitate and invest in R&D to develop new solutions, including the use of distributed ledger technology for inter-bank payments and trade finance, while expanding the web of cross-border cooperation agreements with other key FinTech centres, helping to grow Singapore as a base for foreign FinTech start-ups. Technology will be harnessed to simplify financial institutions’ regulatory compliance.
MAS will continue to enhance its regulatory approach, to support enterprise and innovation, while maintaining financial soundness. Key priorities include ensuring that regulations are supportive of innovative business models and strengthening the cyber resilience of financial institutions.
MAS will guide market developments, to ensure that competition stays open, solutions are inter-operable, and consumers’ convenience is enhanced but it cannot dictate individual solutions.
MAS has been one of the early pioneers of the regulatory sandbox, to facilitate experiments and innovation. Mr. Ong said, “In August this year, we had our first graduate from the sandbox, PolicyPal, which uses technology to help users manage their insurance policies, as well as identify duplicate or missing coverage. Another entity, Kristal Advisors, which provides AI powered online investment advisory and management strategies, is currently operating in the sandbox. Several more are in the midst of preparing their launch in the sandbox.”
Jobs and Skills
An active SkillsFuture programme to help the financial sector workforce build world-class skills and maintain a strong Singapore Core will complement the business strategies and innovation agenda. (Financial services is one of the eight priority areas, in which SkillsFuture launched a series of training programmes on October 28. This sector is led by the Singapore Management University.)
Job roles are expected to evolve with digitisation and automation and the ITM notes that existing professionals must be equipped with new skills and competencies.
MAS will continue to collaborate with financial institutions, the tripartite partners, and institutes of higher learning to build a strong local pipeline of specialised talent, particularly in information technology. It will help reskill and redeploy professionals into job growth areas through professional conversion programmes and facilitate job placements through enhanced career advisory services.