Singapore is reportedly assessing plans to issue virtual banking licences to fintech companies.
The Monetary Authority of Singapore (MAS) has confirmed to Reuters about the development.
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The regulator is currently studying the proposition, which if gets clearance, will see digital-only banks to operate in the country.
The move comes at a time when multiple regulators in East Asia have started issuing virtual bank licences.
In a response to a Reuters query, MAS said: “Technology and other non-bank firms have been making large digital strides, and they have brought substantive value to their customers in doing so.
“Some of these non-bank firms have established digital-only banks, either amongst themselves or in partnership with incumbent banks.
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By GlobalData“MAS is studying whether to admit such digital-only banks with non-bank parentage.”
Currently, the regulator is assessing how the entry of these banks will impact the country’s banking sector and its associated risks.
Recently, Singapore has taken multiple initiatives to support fintech development in the country. They include encouraging fintechs with state funding, relaxing regulations and enabling them to test new products in restricted environment.
Earlier this year, Hong Kong issued virtual banking licences to Standard Chartered, Bank of China (HK) and ZhongAn. Later, WeLab Digital also joined the list.
The South Korean authorities have issued two online-only bank licences.
