This was first published in The Business Times on 22 Jan 2019
Singapore’s financial services ecosystem has kept pace with global changes, allowing Singapore to compete against other financial
The $225 million Financial Sector Technology and Innovation (FSTI) scheme was announced on 29 June 2015 to fund the setting up of innovation labs and experimentation through proof-of-concept projects, as well as to incubate new industry initiatives in digital payments and blockchain use cases.
The scheme saw a proliferation of ideas in 2016 and
Both banks and
However, many companies are facing deployment challenges in a number of areas such as costs in implementing new technology while managing and improving incumbent platforms,
Furthermore, there is also resistance in migrating to new technologies such as cloud platforms due to work required and security concerns, and insufficient trained resources in emerging technology areas.
In the face of these challenges, the FSTI scheme that was designed for innovation and experimentation and capped at $200,000 per project, is now inadequate. This is compounded by the fact that larger deployments are likely to be multi-year and multi-million dollar efforts.
The next course of action must be to help remove the barriers to adoption and move
In view of this, a new “Financial Sector Digital Deployment” scheme may be required to hasten the deployment of key technologies.
Such a scheme could focus on three main areas.
First, the FSTI grants could be extended to cover deployment and implementation costs of new technology in areas of digital payments, blockchain, cloud, data and analytics, as well as AI and machine learning technologies, based on say half of the outlay incurred for deployment (to move from design to “go live” phase).
Grants ranging between 30 and 50
To address the tight supply of skilled resources and to propel the adoption of new technologies,
Second, FSTI grants could also be extended to cover cloud migration that typically
These schemes would
Third, as the trade sector moves to other platforms and Singapore connects more with other trading hubs, financial institutions and companies will need to enhance the controls and processes to mitigate the risks of trade-based money laundering and proliferation financing.
To prevent and detect such activities, a platform to monitor trade transactions is needed. Financial institutions and trade participants must be convinced that the commercial benefits of such infrastructure outstrip the added costs of compliance.
Since last September, the Networked Trade Platform was officially launched to
To ensure the success of this platform, the FSTI proof-of-concept scheme could be extended to provide up to 50
With major financial
The article was contributed by Leong Kok Keong, Head of Financial Services, KPMG in Singapore. Views expressed are his own.