MAS to issue up to five new digital bank licences
This is in addition to any digital banks that may be established by Singapore banking groups under the existing internet banking framework that was introduced in 2000.
“The new digital bank licences mark the next chapter in Singapore’s banking liberalisation journey,” Senior Minister and MAS Chairman Tharman Shanmugaratnam said at the 46th annual dinner of The Association of Banks in Singapore (ABS).
“They will ensure that Singapore’s banking sector continues to be resilient, competitive and vibrant.”operations
“The entry of new digital players will add diversity and strengthen Singapore’s banking system in the digital economy future,” MAS said.
“With innovative business models and strong digital capabilities, these players can cater to under-served segments of the market. They will provide impetus for existing banks to continue enhancing the quality of their digital offerings.”
In July 2000, MAS issued a policy statement allowing Singapore banking groups to set up digital bank subsidiaries.
The banks could either set up the subsidiaries themselves or with joint venture partners where the Singapore banks retain control.
The minimum paid-up capital required of the subsidiaries is set at S$100 million, given that the parent banks meet the S$1.5 billion capital requirement.
United Overseas Bank (UOB) welcomed the new digital bank licences and the “diversity that the new players may bring” with it.
“Banking will continue to be shaped by how financial service providers ensure customers’ interests are not only anticipated, met and protected, but that their experiences are also differentiated,” deputy chairman and CEO Wee Ee Cheong said.