The Monetary Authority of Singapore (MAS) on Friday (Dec. 4) chose four firms to receive digital banking licenses, including “digital full bank” licenses for Singapore-based Sea Ltd. and a consortium of Southeast Asia’s Grab Holdings and technology group Singtel.
Authorities also selected China’s Ant Group and a consortium of Greenland Financial Holdings Group, Linklogis Hong Kong Ltd., and Beijing Co-operative Equity Investment Fund Management Co. to receive “digital wholesale bank” licenses.
“MAS applied a rigorous, merit-based process to select a strong slate of digital banks,” MAS Managing Director Ravi Menon said in announcing the move. “We expect them to thrive alongside the incumbent banks and raise the industry’s bar in delivering quality financial services, particularly for currently underserved businesses and individuals. They will further strengthen Singapore’s financial sector for the digital economy of the future.”
MAS said there were 14 eligible applications and that it was willing to award up to two licenses for digital full banks and up to three for digital wholesale banks.
The successful applicants must still meet all relevant prudential requirements and licensing pre-conditions before MAS grants them final banking licenses. MAS expects the new digital banks to commence operations in early 2022.
Anthony Tan, Group CEO and co-founder of Grab, said in a joint press release from Grab and Singtel, “With Grab and Singtel’s combined experience in meeting the everyday needs of Singaporeans, as well as our deep tech expertise and data-driven insights, the digital bank will further our goal to empower more people to gain better control of their money and achieve better economic outcomes for themselves, their businesses and families.”
Citibank veteran Charles Wong has been named CEO of the Grab-Singtel consortium, which is already hiring people with varying expertise in banking, FinTech, and technology. Central positions in data, cybersecurity and technology have already been filled, and an additional 200 people will be hired by the end of next year.
Wong said in the Friday (Dec. 4) joint press release that this is a “truly rare opportunity” to create a digital bank from the ground up and “redefine banking” while also meeting the needs of the underserved and underbanked in Singapore.
The Grab and Singtel consortium aims to meet the financial services needs of both consumers and small businesses, especially the 40 percent of Singaporeans who are underbanked. The new digital bank will also introduce expanded finance options for the growing group of professionals, managers, executives and technicians (PMETs); gig workers; and micro, small, and midsize enterprises (MSMEs).
Wong added that the digital bank will advance the mission of helping people “gain better control of their money and achieve better economic outcomes.”
The companies said they are on a mission to build a digital bank for the people of Singapore that is easy to use and highly secure while also creating job opportunities. Training will be provided to enable Singaporeans to take on FinTech and other technology roles in security, data science, analytics and engineering.
Yuen Kuan Moon, CEO-designate, Singtel Group, said the combined companies “have the assets and the synergies to make banking more accessible and intuitive.” He added that the company is looking forward to developing “a strong Singaporean core of FinTech talent,” at a time when digital transactions are critical amid the COVID-19 pandemic.
Sea Ltd. Chairman and Group CEO Forrest Li said in a statement that his firm’s mission “is to better the lives of consumers and small businesses through technology. We are honored to be selected by the Monetary Authority of Singapore for the award of a digital full bank license and to have the opportunity to offer digital banking services addressing the underserved financial needs of young consumers and SMEs in Singapore.”
Earlier this week, MAS announced that non-bank lenders in Singapore will soon be able to use the country’s digital payments platforms PayNow and FAST.