Singapore is ready for open banking, but regulators don’t want to force it on the financial services market, according to reports in Bloomberg.
The publication said this week that the Monetary Authority of Singapore (MAS) prefers a more “organic” approach to open banking, instead of using regulations to force financial institutions to share data. David Hardoon, the MAS’ chief data officer, told the publication that the path toward open banking in the country will be more successful if industry players aren’t strong-armed into it.
“You can come and say, ‘Though shall do it,’ but then nothing happens effectively,” he said.
Bloomberg highlighted how Singapore’s approach differs from open banking initiatives in Europe and Japan, where regulators have imposed requirements for banks and other financial institutions to support the movement of data between their systems and those of third-party financial service providers. Such was the aim of PSD2 in Europe and Open Banking in the U.K.
According to Hardoon, the nation’s banks will instead see the benefits of Open Banking in other markets and want to embrace data sharing because of them.
“The point being, we are heading there in an organic fashion,” he said. “I believe the Open Banking approach is a good thing and definitely can benefit Singapore.”
Reports noted Singapore’s largest bank, DBS Group Holdings, has taken steps to embrace Open Banking with the launch of a platform enabling third-party developers to access 155 APIs to integrate functionality into their own services, like real-time payments. Further, Oversea-Chinese Banking Corp has already launched an API platform and recently revealed a partnership with StarHub to facilitate data sharing with the telecommunications firm.
The MAS is also readying guidelines for ethical data sharing and analytics, as well as use of artificial intelligence, for both regulated and unregulated players in the financial services space, according to Hardoon.