SINGAPORE: Foreign companies, including those from Malaysia, are eligible to participate in the further liberalised Singapore banking industry.
The republic will issue up to five new digital bank licences, a move which extends digital bank licences to non-bank players.
The Monetary Authority of Singapore (MAS) said it expects to invite applications in August and will provide more detail on the eligibility and admission criteria at that time.
The five new digital bank licences will comprise up to two digital full bank licences, which allow licensees to provide a wide range of financial services and take deposits from retail customers, and up to three digital wholesale bank licences, which allow licensees to serve small and medium enterprises and other non-retail segments.
Application for digital full bank licences is open to companies headquartered in Singapore and controlled by Singaporeans.
MAS said foreign companies are eligible for these full bank licences if they form a joint venture with a Singapore company and the joint venture meets the headquarters and control requirements.
Application for digital wholesale bank licences, however, is open to all companies.
“The new digital bank licences mark the next chapter in Singapore’s banking liberalisation journey,” said Senior Minister and Chairman of MAS, Tharman Shanmugaratnam, in announcing the measures at the 46th annual dinner of the Association of Banks in Singapore on Friday.
“They will ensure that Singapore’s banking sector continues to be resilient, competitive and vibrant,” he said.
According to MAS, the entry of new digital players will add diversity and strengthen Singapore’s banking system in the digital economy of the future.
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, it said.
MAS noted that Singapore banking groups may also establish digital banks under the existing Internet banking framework introduced in 2000 rather than applying for the new licences. – Bernama
