Earlier this year, MAS shared its vision of a Smart Financial Centre: a financial centre where innovation is pervasive and technology is used widely. It is about pursuing innovation and technology to: •  increase efficiency;  •  manage risks better;  •  create new opportunities; and  •  improve people’s lives. We are walking the talk. •  We formed a new FinTech & Innovation Group (or FTIG) within MAS. •  FTIG’s mission is to formulate policies and strategies to create a conducive ecosystem for innovation while fostering safety and security. BIS central bankers’ speeches  1  •  MAS has committed $ million over the next five years under the Financial Sector Technology and Innovation scheme. We have been working closely with the industry as well as reaching out to the broader “fintech” community. •  We have been talking to start-ups, software providers, and experts and practitioners in various fields of financial technology, including data analytics, cyber security, blockchains, and digital payments. •  We have learnt much from these interactions. The response from the industry has been encouraging. •  Insurers such as Aon and Metlife as well as banks such as Citibank, Credit Suisse, DBS, HSBC, and UBS have already set up innovation labs in Singapore. •  Aviva has announced plans for a “Digital Garage” and AXA for a “Data Innovation Lab” here.
•  MAS is working with several other banks and insurers on their plans to establish and expand their analytics and innovation teams in Singapore. At the heart of a Smart Financial Centre must be a progressive information technology architecture. Two key characteristics of such an architecture are: •  common standards; and  •  seamless data sharing. Common standards Let me begin with common standards. They are key to making systems interoperable and harnessing fully the benefits of new payments technologies. Lack of standardisation leads to fragmentation, inefficiency, and inconvenience. •  Take for example electronic funds transfer. •  Without a common standard, an application written to effect funds transfer for one group of financial service providers may need to be rewritten to work with another group of financial service providers that operate on different interface standards. Common standards allow systems and applications to operate efficiently and seamlessly when different financial service operators and solution providers come together. •  The EMV chip is one of the most impactful examples of a common standard. It is all the more impressive as it was an industry initiative without any government involvement. •  NFC, or near-field communications, represents the next big thing in common standards. It is enabling contactless payments on mobile devices like smart phones. Yet another good example of a common standard is ISO 20022. This is the international standard for electronic data exchange among financial institutions. •  Its growing adoption has helped to make payments platforms interoperable and reduce inefficiency.