The Monetary Authority of Singapore (MAS) has set up a lab to provide a platform for startups, technology vendors, and financial institutions to test out new fintech tools.
The facility also would offer startups access to subject experts for advice in the areas of legal, regulation, and business-related issues, amongst others.
Located at the MAS Building, the new fintech lab would "allow MAS to experiment" with fintech tools alongside market players, the industry regulator said in a statement Wednesday. In addition, relevant fintech training sessions and networking activities would be hosted at the facility.
MAS Chief Fintech Officer Sopnendu Mohanty said: "MAS has been encouraging financial institutions to anchor their innovation labs in Singapore. Today, we are pleased to open our own FinTech Innovation Lab, underscoring MAS' commitment to promoting a culture of innovation in the financial sector.
"[The lab] will serve as a platform for the FinTech community to connect, collaborate, and co-create with one another," Mohanty said.
MAS Managing Director Ravi Menon further underscored the need to build up talent and funds in order for the local fintech ecosystem to keep pace with its counterparts in New York and Silicon Valley. Speaking to local media, Menon said the new lab would focus on later-stage startups looking to test out their ideas and need advice on legal and regulatory issues.
The regulator previously highlighted the need for a sandbox environment that would enable any organisation, within or outside the financial services industry, to experiment with new fintech products and services, under less stringent regulatory requirements. These pertained to a range of legal requirements such as the company's asset maintenance, credit rating, license fees, and minimum liquid assets.
Plans underway to boost e-payment ecosystem
To further drive the industry, MAS last weeks said it was assessing the e-payments market and looking at ways to promote the sector in Singapore. Efforts here would include a streamlining of the country's regulatory framework to establish a single legislation governing both traditional and digital payment services as well as provisions for consumer protection.
The regulator also would look to establish an "inclusive governance framework", which might result in a new Payments Council comprised of representatives from providers as well as users of payment systems. The objectives of this group, amongst others, would be to develop a common payments infrastructure and promote open access and interoperability between payment tools.
In addition, MAS would be looking to fuel the adoption of e-payments among the local population, which still showed a preference for paper-based options--cash and cheques--despite living in a country with one of the world's highest smartphone penetration rates.
Citing a KPMG report commissioned by the regulator, Menon said Singapore's cash in circulation accounted for 8.8 percent of its GDP, compared to 4.4 percent in Australia and 2.2 percent in Sweden. In addition, 12.7 cheques per person were issued in Singapore in 2014, compared to 7.1 in Australia and almost zero in Sweden.
With the social costs of cash and cheques--attributed to securing cash and processing cheques--estimated to be some 0.5 percent of GDP, or S$2 billion a year, MAS was keen to change the stats.
To help drive the adoption of e-payments, Menon said it would aim to promote online fund transfers, simplify the acceptance of card payments at retail outlets, facilitate online bill payments, and enable mobile payments for public transport.
"Of all the developments in fintech, it is in payments where the gains in financial inclusion are potentially strongest--for the simple reason that we all need to use payment services to participate in the economy and society," he said. "Our vision is to make Singapore an electronic payments society."