There has been an intense fintech explosion in Asia, with Singapore at the forefront of this growth. With more than 400 fintech startups in the country, Singapore stands out as the leading global fintech hub. Its strong financial presence has been an active catalyst in catapulting it towards fintech innovation. Furthermore, the country is riddled with plenty of incentives that favor fintech startups. These include positive tax laws, great infrastructure, and access to global markets. Not to mention, Singapore’s government has been the number one contributor to the country’s leading position in fintech. It’s estimated that Singapore achieved a shocking record high of $229.1 million of fintech funding last year.
Fintech startups in the country also enjoy MAS (Monetary Authority of Singapore) backing. MAS does so by offering a start-up friendly ecosystem and expert mentorship programs. They have also implemented a regulatory sandbox that creates a safe environment for new start-ups to test their projects without comprising the industry’s security. Within this sandbox, fintech startups can experiment with their ideas without the fear of being penalized. The Singapore Fintech Festival was also created as a celebration of all fintech-related innovations with the goal of recognizing startups. It also intends to bridge the gap between young fintech startups and potential investors. All this is to help with the government’s goal of adding about 1,000 fintech jobs every year.
Fintech in Singapore
Fintech remains one of Singapore’s top priorities as the state works on moving towards becoming the world’s fintech center. The MAS has launched a number of initiatives that are geared towards encouraging the growth and development of domestic fintech startups. The FSTI (Financial Sector Technology and Innovation) scheme plans to offer support for fintech projects by providing a $166 million fund. In May, the National Research Foundation in collaboration with MAS launched the Fintech Office. The Fintech Office was created to be a one-stop center for all matters relating to fintech. Any fintech business that needs information or advice regarding government grants and schemes can visit the fintech office portal at any time.
MAS also set a regulatory sandbox in place for fintech experiments for both financial and non-financial players. It also intends to introduce new regulations that would simplify the setup process for startups and SMEs to raise funds based on secure crowdfunding platforms. Apart from that, Singapore will be hosting the Fintech Festival, a five-day celebration event dedicated to fintech, in November this year. The country has also been striking partnerships with fintech friendly regulators such as the UK’s FCA to give domestic companies access to more diverse markets.
Fintech Regulatory Sandbox
By use of the sandbox approach, MAS encourages and helps fintech startups to experiment with their ideas with the chance of developing further. The startup can offer their innovative solution(s) to a group of customers and experiment with it for a certain period of time. They do this under boundary conditions set up by MAS. During this period, if both the startup and MAS are satisfied with results, provided the startup can comply with relevant legal and regulatory requirements, the idea can be deployed on a larger scale. All startups that want to make use of the sandbox must first submit an application before they start.
Fintech Companies Focused on Blockchain Technology in Singapore
Singapore has already embarked on an ambitious plan that intends to take advantage of the benefits of blockchain technology. Already, the number of blockchain-based tech companies has skyrocketed in recent months. These fintech startups are expected to flourish as more businesses make the move away from low-value transactions to transactions that cater to complex demands in today’s world. The majority of these startups seek to explore the use of blockchain technology for payments, security clearance, and for settlements. Let’s take a look at some of these fintech startups focused on blockchain tech.
TenX is a Singapore based company that aims to make spending cryptocurrencies as easy as possible. It’s well-known for its debit card that offers users with the capability of spending their cryptocurrency assets whether online or offline without the need for an exchange or transaction fees. The TenX mobile wallet can be linked with Visa credit cards so that users can be able to make purchases using their digital currency accounts. The TenX Company has acquired received funding of about US $81 million so far.
Qtum was developed by the Qtum foundation in 2016 as a decentralized value transfer program and app platform. It was designed as a hybrid of both the Bitcoin blockchain and the Ethereum blockchain. It integrates the two by taking the best parts of each and creating a business-friendly platform. It bridges the two blockchains to offer functionalities such as value transfer and support for DApps and smart contracts. The Qtum Company has so far raised capital funding of about US $51 million.
- Kyber Network
The Kyber Network is a fintech startup company in Singapore that has received $52 million in funding. The company is building something unfamiliar. It is creating a simple to use and decentralized exchange platform that will run entirely on the blockchain. The company’s CEO, Loi Luu started the company inspired by the Mt Gox saga. He wanted to create an exchange platform that would be impervious to hackers and one that wouldn’t need a tedious verification process. Apart from offering security from cyber-threats, the company aims to offer seamless conversion of digital assets in a matter of seconds.
With more startups joining the blockchain solutions sector, there is no shadow of a doubt that blockchain is guaranteed to be a major technology of the future. Even though the technology hasn’t seen global adoption, the rate at which blockchain-based companies are erupting is enormous. That rate is proof enough of the willingness of people to venture into blockchain-based activities. We believe that Singapore will continue to be a hub for fintech companies, especially with the growing number of incentives aimed at boosting the sector.
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