Singapore is portrayed by observers as being in a hurry to "reinvent itself as Asia's financial technology hub". Fintech taps information technology to provide financial services in better or utterly new ways. It is the game of a wave of disruptors that have emerged on the scene. The approach of the city state is that if you can't beat them, join them. Strategists believe fintech has a crucial part to play if the Republic is to remain a regional financial hub. Towards this end, a one-stop centre, the FinTech Office, has been set up to give start-ups guidance on technology-linked state grants, industry programmes and regulatory requirements. And mass adoption is being promoted via a vision of an "electronic payments society".
The great differentiator in the multibillion-dollar fintech race is scale. Alipay, for example, controlled by Chinese e-commerce giant Alibaba, ranks as a top payment option with 500 million users. China's successful chat app, WeChat, hopes to leverage up to 697 million active users worldwide each month as it enters this market. It is offering the convenience of both moving money between WeChat users as well as paying offline retailers. Also striving to make inroads with its platform is WhatsApp, now owned by Facebook, a global giant.
Against this backdrop, Singapore is eyeing a regional e-payments strategy that can be extended to over 600 million people in Asean, encompassing a burgeoning middle class as well as millions who now have no access to financial services. Creating a fintech ecosystem on this scale is no mean task. It calls for a winning combination of technology, security, accessibility, affordability and collaborative oversight. "There is no better country than Singapore to pull these pieces together", as a top Singapore banker noted.
A crucial part of this jigsaw puzzle is the development of a common payments infrastructure which goes beyond the work of software boffins alone. Innovation ecologists, entrepreneurs, financial institutions, policymakers and others have a part to play as well.
Bringing them together is one of the aims of the Monetary Authority of Singapore's Looking Glass @ MAS, an innovation lab announced last week. Wider acceptance of innovations will be important to help fintech efforts gather momentum. Hence, the inaugural Singapore FinTech Festival, to be held in November, should also reach out to the public in different ways. Alongside providing an opportunity for the fintech community to connect with teams from abroad, the festival ought to be harnessed to capture the public imagination. The vast potential of a fintech-enabled region should be spelt out to win over people. Apart from turbocharging trade across borders, such change could result in broader financial inclusion here and elsewhere.