FINANCIAL TECHNOLOGY | Staff Reporter, Singapore

Singapore mulls licenses for virtual banks

The DBS CEO earlier echoed a similar stance.

Reuters reports that the Monetary Authority of Singapore (MAS) is studying whether to allow fintech firms to operate digital-only banks in a move that comes after close regional competitor Hong Kong issued such licenses to four firms. “MAS is studying whether to admit such digital-only banks with non-bank parentage," the regulator told Reuters.

Singapore is actively pushing to cement its fintech hub status with massive state allocations, light-touch regulation and moves allowing startups to test financial products in a controlled environment.

DBS CEO Piyush Gupta told Bloomberg in an earlier interview that Singapore may soon allow virtual banks to set up shop although he downplayed the impact of the digital newcomers.

Similarly, OCBC CEO Samuel Tsien cautioned against a one-size-fits-all approach by fintechs. “[T]he operating model of such banks cannot be a one-size-fits-all regardless of the operating environment,” Tsien said, highlighting Singapore’s small domestic market with almost every Singapore resident having access to banking services.

The Hong Kong banking regulator earlier issued so-called virtual banking licenses to four companies including fintech firm WeLab and entities backed by Standard Chartered, Bank of China (Hong Kong) and online insurer ZhongAn. In South Korea, authorities have issued two online-only bank licenses in 2017.

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