MAS has received 21 applications for digital bank licenses until the close of the application period on December 31, 2019. Seven applications were for the digital full bank licenses, while 14 applications were for the digital wholesale bank licenses. Successful applicants, which will be announced in June 2020, are expected to commence business by mid-2021.
The new digital bank licenses have attracted strong interest from a diverse group of applicants, which include e-commerce firms, technology and telecommunications companies, fintech institutions (such as crowd-funding platforms and payment services providers), and financial institutions. The majority of applicants are consortia, with entities seeking to combine their individual strengths to enhance the value proposition of a digital bank.
MAS will evaluate all eligible applications based on their value propositions including the innovative use of technology to serve customer needs, their ability to manage a prudent and sustainable digital banking business, and their contributions to the financial center in Singapore. The issuance of the new digital bank licenses, comprising up to two digital full bank licenses and three digital wholesale bank licenses, is a significant initiative aimed at enabling non-bank players with strong value propositions and innovative digital business models to offer banking services. Digital full bank will be allowed to take retail deposits, while digital wholesale banks will focus on serving small and medium-size enterprises and other non-retail segments. These new digital banks are in addition to any qualifying subsidiaries that Singapore bank groups may already establish under the MAS’ existing regulatory framework for the purposes of operating new business models, including partnerships with non-bank players to conduct digital banking.
Keywords: Asia Pacific, Singapore, Banking, Digital Banks, Licensing Applications, Fintech, Bank Licenses, MAS
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