Shaping Singapore’s Financial Future: MAS Unveils Vision at FinTech Festival 2023

In a keynote address at the Singapore FinTech Festival, Mr. Ravi Menon, Managing Director of the Monetary Authority of Singapore (MAS), outlined a visionary roadmap to shape the financial landscape. The speech focused on three pivotal outcomes driving Singapore’s emergence as a Smart Financial Centre: Instant Payments, Seamless Financial Transactions, and a Trusted Sustainability Ecosystem.

Instant Payments: Transforming Cross-Border Transactions

The cornerstone of Singapore’s financial evolution is the drive towards instant payments. Menon highlighted the success of initiatives like FAST and PayNow, which enable real-time, 24/7, and zero-cost transfers across bank accounts and e-wallets. The revolutionary SGQR label, accepted by over 90% of merchants, consolidates QR code payments and paves the way for complete QR interoperability. Notably, Singapore has forged bilateral links with countries like Thailand and India and is expanding to Malaysia and Indonesia, fostering a seamless cross-border payment experience.

Project Nexus, a collaboration with the Bank for International Settlements (BIS) Innovation Hub, aims to create a multilateral instant payment network across ASEAN countries. The ultimate vision is a global coalition for secure, efficient, and affordable cross-border transactions, reflecting MAS’s commitment to a “global public good payment utility.”

Seamless Financial Transactions: The Convergence of Digital Assets, Digital Money, and Infrastructure

MAS’s larger vision revolves around creating a network of interoperable systems for instantaneous and seamless payment, clearing, and settlement. Digital assets, featuring tokenization for atomic settlement and fractionalization, play a pivotal role. Project Guardian, a MAS initiative, focuses on tokenizing various asset classes, from foreign exchange to bonds and funds. This enables broader investor access, liquidity enhancement, and operational efficiency.

Digital money emerges in four forms: cryptocurrencies, central bank digital currencies (CBDCs), tokenized bank liabilities, and well-regulated stablecoins. Cryptocurrencies face challenges, but wholesale CBDCs demonstrate potential for atomic settlement. Notably, MAS will pilot the “live” issuance of wholesale CBDCs, reinforcing central bank money’s role in safe and efficient payments. Stablecoins, once well-regulated, could introduce innovative use cases, as demonstrated by Project Orchid’s purpose-bound money applications.

The final piece of this transformative landscape is digital infrastructure. To address existing limitations, MAS introduces the Global Layer One (GL1) initiative, a foundational digital infrastructure fostering open, interoperable, and compliant networks. GL1 aims to facilitate seamless cross-border transactions and global trading of tokenized assets while adhering to regulatory requirements.

Trusted Sustainability Ecosystem: Project Greenprint

Project Greenprint, MAS’s initiative to build a trusted data ecosystem supporting sustainable finance, takes center stage. The new Greenprint integrated platform, driven by Greenprint Technologies, streamlines ESG data collection and reporting. By simplifying reporting for SMEs and leveraging AI tools, Greenprint aims to become a baseline for global ESG data reporting, promoting sustainability beyond Singapore’s borders.

In conclusion, Mr. Menon emphasized that FinTech’s higher purpose is about solving real-world problems, improving lives, fostering inclusivity, and securing a sustainable future. The unveiled initiatives position Singapore at the forefront of global financial innovation, signaling a commitment to building a better world through FinTech.