Singapore is an established global financial services hub - placed third in the Global Financial Centres Index (GFCI) 19 in terms of overall ranking (and first in the APAC region) - and is home to over 200 banks with total assets amounting to $2 trillion who have based their operational headquarters in the city-state. This provides ample opportunities for Swiss Fintech companies wanting to tap into the market.
According to KPMG, Singapore has seen close to 200 foreign and local Fintech companies commence domestic operations from 2014 to 2016 – registering the fastest growth rate in Asia.
Excellent business environment for Fintech companies
The boom in Singapore’s Fintech industry is attributed to several factors including the business-friendly environment, excellent government support, light-touch regulation, and access to expertise.
The Monetary Authority of Singapore (MAS), Singapore’s central bank and financial regulator, has budgeted S$225 million to develop Fintech projects and applications. In April 2016, MAS appointed a Chief Fintech Officer to be responsible for formulating regulatory policies and developing strategies to facilitate the use of technology and innovation to better manage risks, enhance efficiency, and strengthen competitiveness in the financial sector. In February 2017, it also appointed a Chief Data Officer to lead efforts to harness the power of data analytics to unlock insights, enhance the supervision of financial institutions, make regulatory compliance more efficient for financial institutions, and improve work efficiency across the organization. MAS has successfully concluded a proof-of-concept project conducted with R3 and a consortium of financial institutions which uses distributed ledger technology (DLT) on domestic inter-bank payments, a sign of commitment by the central bank to co-develop and adopt Fintech solutions.
Recognizing the benefits of the ecosystem and the need to localize, leading banks and financial services firms such as Mastercard, UBS, Wells Fargo and Citigroup have opened up Fintech labs in Singapore to integrate emerging innovations into their businesses.
Singapore banks initiate Fintech initiatives
The Singapore banks have also outlined strategic plans to nurture their respective Fintech accelerators and digitization initiatives. As a start, DBS set aside S$10 million to co-fund Fintech start-ups in 2015, and concurrently, they have invested S$200 million over 2015-2016 in addition to the annual investment of S$600 million on digitization and Fintech.
In a bid to encourage regional Fintech growth, UOB has partnered with OurCrowd to launch its equity crowdfunding platform, as well as offering funding capital of US$500 million to startups across China, India and ASEAN. Meanwhile, OCBC have partnered with American company Nest to setup a dedicated Fintech accelerator to trial varying solutions across wealth management, customer service, and operations. In line with these developments, IBM announced its plans to establish the first IBM Centre for Blockchain Innovation in Singapore – with a focus on Fintech, blockchain, and cyber security. The technology giant recently collaborated with Singaporean startup KYCK! to use its blockchain technology in enhancing customer on-boarding process for financial services providers.
Singapore: Fintech cooperation framework with several nations
Japan is the latest country to establish a Fintech cooperation framework with Singapore. Singapore has signed agreements with the U.K., South Korea and Abu Dhabi among others.
While the domestic market continues to reinforce its position as a preferred Fintech location, the bigger picture and market potential lies in South-East Asia. Compared to London, New York and Hong Kong, Singapore can offer greater access to ASEAN via closer economic and diplomatic ties, as well as a more nuanced understanding of the respective business cultures.
Swiss Fintech industry: excellent providers for Fintech solutions
The Swiss Fintech industry offers a range of solutions relevant to Singapore and greater Asia. These include:
- Payments (milliPay, AdmiCash)
- Lending / Crowdfunding (TAS Helvetia)
- Blockchain / Cryptocurrency (Bity)
- Big Data & Analytics (finnova, Centredoc, Incentage, Sanovation, mimacom, Crossing-Tech)
- Fraud / Security / Authentication (Qumram, Netcetera, AdNovum, netsense)
- Investments (multilateral, Profidata, Expersoft Systems)
- Insurtech (WMC IT Solutions, Adcubum, alabus)
If you are interested in receiving more information and want to know how Swiss SMEs can benefit, please contact S-GE or its Swiss Business Hub ASEAN for an initial assessment.
Region: Asia/ Singapore