We should not be hasty in disrupting traditional banking for banks hold a fiduciary duty to their customers (Singapore digital bank aspirants must prove they can make money, Dec 18).

We should learn from the mayhem of peer-to-peer (P2P) lending elsewhere, where amateurish parties exploited the Internet as a platform to garner funds from unsuspecting depositors to lend indiscriminately to unvetted borrowers.

We should hold the same, if not higher, standards of scrutiny on digital banking licence applicants, as those of traditional banking. This is to regulate transactions in the amorphous Web space.

It may take some time before these new digital entities work out the business model for them to turn profitable. Meanwhile, the learning curve will be steep and depositors should not bear the cost of this learning. There should be adequate capital buffers to absorb any shocks.

It cannot be that banking is treated as an offshoot of an applicant's core business so as to generate another stream of revenue. The applicants may have accumulated a huge repository of information on transactions and customers, and hope to add banking to their apps to encourage utilisation. If their existing business models have yet to turn profitable, the foray into banking is no guarantee of profit either.

Banking has morphed into a complex business and it will take time to learn it. It requires not just traditional banking knowledge but also the skill to leverage technology to enhance the business. Building a full-licence digital bank is not insurmountable with the right talent. Prudence should rule the day. Lee Teck Chuan