The Monetary Authority of Singapore (MAS) has restated its commitment to drive innovation in its financial system by launching a new funding scheme for projects in the country.
The banking regulator announced it will allocate SGD150 million (US$111 million) over three years to develop innovative fintech solutions, administering the fund under the third iteration of the Financial Sector Technology and Innovation Scheme (FSTI). Specifically, MAS will be looking to fund projects relying on “cutting-edge technologies” and those with a regional outlook.
MAS is keen on funding Web3 projects building in financial markets with blockchain technology. The fund will also include corporate venture capital (CVC) entities for their importance in “identifying and nurturing the next generation of start-ups.”
“MAS recognises the importance of partnering with the industry to support innovative FinTech solutions arising from emerging technologies such as Web 3.0,” it stated. “MAS will conduct open calls for the use of innovative technologies in industry use cases.”
The scheme will comprise three tracks: the Enhanced Centre of Excellence track, an Innovation Acceleration track, and an Environmental, Social and Governance (ESG) track. The Enhanced Centre of Excellence track will cap funding at SGD2 million (US$1.4 million) per project, while the ESG track will set funding at SGD500,000 (US$371,000) per project.
The grant funding will be provided contingent on completing trials and commercializing use cases, according to the central bank.
Startups that receive the FSTI funding will be expected to give back to the local ecosystem by devoting “resources to talent development in order to strengthen the Singaporean FinTech talent pool.”
Aside from blockchain and Web3 technologies, MAS announced that the FSTI will also be focused on solutions revolving around Artificial Intelligence and Data Analytics (AIDA) and Regulation Technology (RegTech). The central bank says it will focus on providing small businesses access to AIDA and RegTech to enable them to compete with larger entities.
“Notably, FSTI 1.0 and 2.0 helped strengthen the digital capabilities of financial institutions which served them and their customers through the COVID pandemic,” read the announcement.
“With FSTI 3.0, we look forward to continued collaboration with the industry to advance purposeful financial innovation.”
An alternative to Hong Kong
Despite a rough patch in 2022, Singapore still commands interest from global digital currency firms seeking to set up operations in the city-state. The grant of property rights on digital assets is also reportedly an indication of the country’s favorable stance toward digital currencies.
As Hong Kong continues its push to be the digital asset capital of Southeast Asia, experts have hailed Singapore’s latest moves as offering an alternative to global players.
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