SINGAPORE (THE BUSINESS TIMES) - The amount of money directed into digital banking investments has shot up amid Covid-19 and efforts by banks to boost their online offerings, according to a new global study.
The study by software firm Finastra found that 90 per cent of 785 financial service professionals surveyed globally said the pandemic had accelerated the integration of new technology and innovation.
In Singapore, this translated into the largest average increase in digital banking investment of any market (25 per cent) while 84 per cent here said their bank had increased overall investment/budgets, also the highest globally.
Adapting to fresh challenges brought about by Covid-19 was the third-biggest driver of the adoption of technology (47 per cent), just behind cost-cutting and efficiency (54 per cent) and business growth (48 per cent).
Almost half of those surveyed in Singapore deployed or improved their banking-as-a-service capabilities in the last year, with 45 per cent looking to do so in the next 12 months, higher than in any other market surveyed.
Still, a few key barriers to innovation persist, the study noted.
Nearly 60 per cent of those surveyed here said decision-makers are "stuck in old ways of thinking", while more than half also cited cost of development and tight industry regulations.
With the issuance of digital bank licences and the launch of SGFinDex last December, open banking has also become important to 97 per cent of businesses in Singapore, with more than half calling it a "must-have".
"Through initiatives like banking-as-a-service and open banking, financial institutions in Singapore are laying the foundations for truly open finance, enabling banks to... provide ever more innovative and competitive services," said Mr Luc Hovhannessian, Asia-Pacific managing director at Finastra.
The survey was conducted in March among professionals at banks and financial institutions across Singapore, Hong Kong, the United States, Britain, France, Germany and the United Arab Emirates.