The Monetary Authority of Singapore (MAS), Senior Minister and Chairman, Tharman Shanmugaratnam has announced that it will issue up to five new digital bank licenses, which will be extended to non-bank players.
The announcement was made during the 46th Annual Dinner of The Association of Banks in Singapore at Raffles City Convention Centre on Friday.
“The new digital bank licenses mark the next chapter in Singapore’s banking liberalisation journey,” said Tharman. “I am confident that (the local banks) will hold their own against the new competition.”
He added that the banking sector is on the verge of transformation, with the far-reaching effects of digitalisation “stimulating a fundamental rethink of the role of banks in most advanced financial centers.”
” We must take advantage of these opportunities that digital finance brings, and not be overtaken by the wave of changes taking place globally. We must allow for greater competition and spur greater innovation in finance,” he said.
A digital-only bank provides the facilities online so they do not typically need physical branches.
They can also offer services using automated processes and real-time updates.
The new licenses are in addition to any digital banks local lenders can set up under the existing Internet banking framework, he said.