MAS’s managing director, Ravi Menon, revealed that this was a part of the Financial Sector Technology & Innovation (FSTI) scheme during a speech at the Global Technology Law Conference.
Financial backing through FSTI is intended to drive a fintech ecosystem, in addition to building the technology skills among the country’s workforce, he said.
Menon cited the proliferation of robots and unmanned drones, in the form of robotic cleaners like iRobot being used in household chores and drones being used for food deliveries by pizza restaurants in cities like Mumbai to Moscow, as an example of the wave of broad technological change that fintech is a part of.
He also noted the growth of digital payment systems in emerging markets, citing the launch of Kenyan venture M-Pesa in 2007, which functions as a simple and low-cost service that allows users to deposit and transfer funds through SMS text messages.
Increasingly, the non-financial players are using technology to offer innovative solutions, mirroring services traditionally offered by financial institutions (FIs), particularly in the realm of digital payments, online lending platforms and investment advisory and management services. This disruption is creating increasing competition for banks and other financial institutions.
The MAS funds will be used to incentivise banks to establish R&D and innovation labs, as well as other infrastructure, in the city-state. According to Menon, Metlife and UBS are among a number of institutions that have applied for funds under the FSTI.
The FSTI will also go towards supporting major institutional and industry projects. Examples of such possible projects are decentralised record-keeping systems for trade financing based on blockchain technologies, cyber risk test-beds and natural catastrophe data analytics exchanges.
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