Singapore’s Banking Liberalisation Progress Enters a New Chapter With Digital Financial Servicing
Singapore’s visionary outlook will open doors to digital banking to help serve new segments of entrepreneurship and customer-oriented needs. Nations worldwide are working towards enhancing consumer needs in every aspect of their lives, even in this digital age.
Living in a Digital World
Technology has always been an enabler as well as improvement to the things we do today. Initially, technology was developed to enable the less able to accomplish what the abled-person can do. It has now grown into almost every aspect of our lives. The same can be said for the banking industry. In this era of digitisation, banks all over the world have moved from physical operation to automation and online banking. Some quarters believe much more can be done to the financial and banking industry.
Digitalizing the Bank
The current practice of banking is that it usually starts with meeting a bank officer at the physical bank to open an account. Or at least having to visit the physical bank for some details validation. A fully digital bank requires no physical interaction nor physical office to operate and provide the full spectrum of banking services. Details validation can be at your fingertips via smartphone or devices application.
License for Digital Banking
The Monetary Authority of Singapore (MAS) will be issuing up to five licences for fully digital banks to operate in Singapore. Such a milestone marks a new chapter for Singapore’s banking industry. New digital bank licenses will be issued to companies that can add value to Singapore’s economy, even with a less established track record in banking. These licences will be issued to local non-banking companies, including e-commerce and technology companies. The five new digital bank licenses comprise of two digital full bank licenses and three digital wholesale bank licences. A complete digital bank will be providing the full range of financial services, and the digital wholesale bank will serve small and medium-sized enterprises as well as other non-retail segments. The licence for a fully digital bank will be issued to companies headquartered in Singapore and controlled by Singaporeans as to maintain a robust local core in our banking system. As for the licence for digital wholesale banks, domestic and foreign players are welcome to apply.
Serving Customers Better
The idea of digital banks is to provide all-round service to customers. Banks and financial service sectors comprise of customers of all kinds with different lifestyles and needs. In the wake of globalisation and digitalisation, customers would prefer the ease of doing business from anywhere in the world. A fully digital bank can offer this and enhancing customer experience will come together with loyalty from customers as well as natural promotion to other potential customers.