Singapore and India to cooperate on fintech regulation
Financial regulators in India and Singapore have signed a “cooperation agreement” designed to promote greater fintech innovation and cooperation between their two countries.
The Monetary Authority of Singapore (MAS) and the International Financial Services Centers Authority (IFSCA) will facilitate greater regulatory cooperation and partnership, the bodies said in a statement announcing the new agreement.
They will establish a regulatory sandbox to “enable innovative cross-border experiments” and explore new fintech use cases in both Singapore and India. MAS and IFSCA will also share more information between their respective jurisdictions to facilitate discussions on emerging fintech issues and promote joint innovation projects.
The agreement ‘paves the way’ for cooperation across national borders
MAS’ Chief Fintech Officer, Sopnendu Mohanty, says: “This [cooperation agreement] building on the Memorandum of Understanding on Supervisory Cooperation signed between MAS and IFSCA in July 2022. The cross-border testing of use cases between Singapore and India will pave the way for the operationalization of a broader cooperation framework for fintech use cases involving multiple jurisdictions.”
IFSCA Chief Technology Officer Joseph Joshy adds: “This agreement is a watershed that ushers in a fintech bridge to serve as a launch pad for Indian fintechs to Singapore and landing pad for Singapore fintechs to India, leveraging the regulatory sandboxes. The opportunity for global collaboration on appropriate use cases through a global regulatory sandbox is an exciting opportunity for the fintech ecosystem.”
The collaboration is an important milestone for Asia’s fintech ecosystem, with the continent’s second most populous nation teaming up with one of the region’s most established fintech hubs. Both countries enjoy high levels of fintech adoption. According to EY, two-thirds of Singapore’s digitally active consumer base (67%), and a large majority of India’s (87%), have adopted fintech in their everyday lives.
Two of Asia’s biggest fintech forces are joining forces
The sharp rise in fintech adoption in Singapore is underscored by its strong credentials as a financial hub, reflecting the availability of fintech services offered by banks, insurance companies, stockbrokers and other established institutions, says EY. Similarly, India has a population of nearly 1.4 billion people – second in the world after China – with smartphone penetration projected to reach as much as 96% by 2040.
EY says the government’s actions are part of the reason fintech services have gained greater awareness and popularity, citing the 2017 announcement by the Indian government signaling the country’s intention to gradually move away from paper currency. There are already more than 1,000 fintechs headquartered in the country, according to Crunchbase, with Mumbai, Bengaluru and Gurgaon all vibrant tech hubs.
