Singapore: Digitization Of A Financial Powerhouse

Last Updated: 14 May 2019
Article by Viktoria Paul and Marco Förster

When Singapore became independent a little more than 50 years ago, the small and resource-poor developing country originally had little chance of survival. Today, the city-state has risen to become the economic hub of Asia, and is mentioned alongside other financial centers such as New York, Hong Kong and Tokyo. Now its financial sector is facing new challenges and rapid digital progress, with technologies such as blockchain and 5G, which will have an even greater impact on it in the foreseeable future.

Singapore's Fintech Sector

Financial technology, or Fintech, has experienced rapid growth in recent years.

In addition to combining traditional financial services with technological solutions, Fintech also unites e-commerce, infrastructure service providers and telecommunications companies under one roof. While investment in the Fintech sector in Asia generally tended to decline, according to Fintech Global statistics, investment in Singapore reached a new record high of US$ 365 million in 2018. By comparison, the investment was US$ 20.8 million in 2014 and US$ 229.10 million in 2017.

This rapid growth is due in particular to the excellent environment Singapore offers to the Fintech sector. In addition to a high per capita income and an excellent infrastructure, the country also offers an ultra-high-speed fiber optic network, which has helped Singapore, to achieve a download speed of up to 55.52 Mbps, ranking first in a worldwide comparison of the fastest broadband connections in 2019. Furthermore, the growth of the Fintech sector is facilitated by various policy initiatives, tax incentives and a favorable regulatory environment.

Regulatory environment and supportive policy measures

Although there are no specific regulations governing the Fintech sector in Singapore, certain financial services provided by Fintech companies fall within the scope of existing regulatory systems in the banking sector. Companies wishing to invest in this sector should therefore urgently examine whether they fall under one of the current regulatory systems, e.g. the Banking Act, the Insurance Act or the Financial Institutions Act. Responsible for the supervision of Fintech companies is the Singapore Monetary Authority. In recent years, this organ has helped Fintech companies to test promising innovations on the market.

The so-called "sandbox" is one instrument that enables Fintech companies to experiment with innovative financial products and services over a certain period of time and within a controlled environment. The main advantages are the ease of the legal and regulatory conditions during the time in the sandbox and the protection in case of disturbances or the failure of experiments. Companies wishing to apply for the sandbox must use new or emerging technologies, or use existing technologies in an innovative way and go through an application and evaluation process with the Singapore Monetary Authority. Upon completion of the "sandbox phase", any easing of legal and regulatory requirements will be lifted and companies must fully comply with all regulatory requirements.

In addition to this, Singapore's central bank began rolling out initiatives to support Fintech companies as early as 2017. Alongside the conclusion of cooperation agreements with the Massachusetts Institute of Technology (MIT) and other institutions in the United States, South America, South Korea, Australia and Hong Kong and the development of a cross-border platform for commercial financing using blockchain technologies, the Singapore Monetary Authority also provided US$225 million for the development of Fintech projects. In parallel, "Fintech innovation hotbeds" such as the "80RR Fintech Hub SG" are increasingly being built in Singapore.

In 2017, the approximately 100,000 square meter large office building was opened in the heart of Singapore's business district and has since housed both international and local Fintech companies and start-ups. "We are very excited to support and promote the rapidly developing Fintech sector by providing an innovative environment and premises at competitive prices for start-ups and other Fintech companies," said an 80RR spokesperson.

Besides the examples above, there are many other programs and opportunities for Fintech companies and start-ups in Singapore that make the city an attractive investment destination.

Cybersecurity through Blockchain

What repeatedly hinders the development and implementation of Fintech, especially in European countries, are the concerns of users regarding the security of such Fintech solutions. Experts see a solution to this confidence problem in the development of "blockchains". The blockchain technology was originally developed to store and send the first crypto currency, Bitcoin. With the development of technology, however, it has also established itself worldwide for other purposes, in particular as a means of increasing cyber security. Blockchains are decentralized databases, that are often referred to as digital ledgers, which chain a continuous list of data records by using cryptography. The special feature of this new technology is the ability to store and manage information of any kind, rather than on a central server, distributed on various computers, similar to a publicly accessible database.

It is precisely this particular feature that makes it possible to increase cyber security. By publishing every transaction, including even the smallest details, an enormous transparency is created between transaction partners, which offers all stakeholders a high level of security and better protection against hacker attacks. In this way, the blockchain technology is able to close basic security gaps.

In 2016, Global eTrade Services (GeTS), a subsidiary of CrimsonLogic, launched the Open Trade Blockchain (OTB), the world's first cross-border blockchain for trade between ASEAN and China's digital silk road. With the help of such blockchains, global trade can become more efficient, secure and transparent, and sectors that depend on cyber security and transparency can benefit from it in the future.

Opportunities for foreign companies

It is easy for foreign investors to invest in Singapore's fintech sector as there are no particular government restrictions.

In addition to the attractive environment that Singapore offers for growth and innovation for both local and international Fintech companies, the financial metropolis also serves as a gateway to Asian markets, especially the ASEAN states. For example, the company Grab, which was founded in Singapore and offers carpooling services, delivery services and logistics services via an App, is enjoying increasing popularity in some Southeast Asian countries such as Vietnam, Indonesia, Malaysia, Thailand, Myanmar and Cambodia. In some of these countries it is now possible to pay conveniently via smartphone with the "GrabPay" app launched by Grab in 2016.

These markets, however, have very underdeveloped Fintech sectors, which offers various opportunities for investing companies. The entire ASEAN region has a population of over 625 million, much larger than the EU with 504 million and the United States with 319 million. According to Fintech Global statistics, Singapore replaced Hong Kong as the leading Fintech hub in Asia as early as 2015 and was able to attract almost twelve times as many investments as Hong Kong in the first half of 2018. This is due in part to the simpler regulations in Singapore compared with Hong Kong's multi-level regulatory structure.

Singapore as a Fintech Oasis

Singapore has set itself high goals and wants to establish itself as the world's greenest city as well as the capital of Asia. Already today, the small city-state, which its inhabitants trivially call "The Little Red Dot", is increasingly referred to as the city of the future. With various political incentives and an attractive investment environment, the city offers outstanding opportunities to become a global Fintech haven.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions