This year, Singapore ranked fifth in the Global Financial Centers Index (GFCI), which measures the competitiveness of financial centers.
There is little doubt that the city-state is gaining competitiveness in fintech and that government support for the sector has increased.
Yesterday (August 13th), the Monetary Authority of Singapore (MAS) announced that it would allocate S $ 250 million to improve the Technology and Innovation Program for the Financial Sector (FSTI 2.0).
The program is intended to promote the expansion of the existing innovation laboratories and further develop Singapore's fintech talents, said Ravi Menon, Managing Director of MAS.
Funding was increased from the previous $ 225 million spread over five years and pumped into the original FSTI program.
An enthusiasm for innovation
Singapore's commitment to innovation and entrepreneurship has contributed to the success of the fintech industry.
Since 2015, over 200 financial institutions have taken advantage of the FSTI program and over 40 financial institution innovation laboratories have emerged.
Notable innovation labs include DBS Asia X, the HSBC Singapore Innovation Lab, and KPMG Digital Village.
DBS Innovation Lab / Photo credit: DBS Asia X.
The emergence of innovation laboratories has also led to the creation of around 180 "quality" jobs, about 60 percent of which are occupied by Singaporeans, Menon said.
The S $ 250 million financing will help financial institutions and fintech companies undertake larger proof of concept (POC) projects to drive the development of innovative solutions.
FSTI 2.0 also aims to boost the adoption of Artificial Intelligence (AI), the newest buzzword in the fintech industry.
The funds for the grant for artificial intelligence and data analysis (AIDA) increased with the new budget from 1 million S $ to 1.5 million S $. This is intended to encourage financial institutions to implement innovative AI solutions in their operations.
Ensure a competitive workforce in Singapore
The rise in adoption of AI does not mean that workers in Singapore will be obsolete.
All AIDA applicants are urged by MAS to work with the Institute of Banking and Finance to actively look for workers who are at risk of being replaced by AI.
Companies then need to develop training plans to keep these workers employable.
FSTI 2.0 also seeks to expand the pipeline of Singaporean talent for fintech.
MAS will co-fund 50 percent of the incremental Singaporean employees in skilled roles for a period of 24 months in existing innovation centers.
These training programs will help support the transformation of the financial sector workforce and accelerate the transfer of skills and knowledge to Singaporean talent, MAS said in a statement.
MAS estimates that fintech companies employ almost 10,000 people.
There are now more than 1,000 fintech companies in Singapore, compared to 50 five years ago.
“We have made good progress towards our vision of a smart financial center. Singapore is consistently in the top three or five fintech hubs, ”said Menon.
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