Fintech companies encouraged by Ravi of MAS to address two fundamental challenges
In the dynamic world of finance, Singapore is making significant strides in leveraging fintech to address some of the industry's most pressing challenges. One such venture, Partior - a joint commercial endeavour among JP Morgan, DBS, and Temasek - has revolutionised Singapore Dollar and US Dollar exchanges. By utilising a blockchain-based multi-currency cross-border clearing and settlement platform, Partior has managed to reduce settlement times from days to mere minutes.
Ravi Menon, Managing Director at the Monetary Authority of Singapore (MAS), has identified cross-border payment and settlement, and high-quality, trusted ESG data as areas where fintech can potentially play a transformative role. In line with this, MAS has launched Project Greenprint, a collaborative effort with the financial industry, to build digital utilities that streamline the collection, access, and use of climate and sustainability data.
Project Greenprint's ultimate goal is to develop a scalable global platform to facilitate the issuance, trading, and end-to-end lifecycle management of sustainable digital assets. Financial institutions like DBS Bank, HSBC, Standard Chartered, and fintech companies including Ngee Ann Polytechnic and Temasek are collaborating on this initiative.
Recognising the need for a more robust ESG fintech ecosystem, MAS has also launched the ESG Impact Hub. This platform aims to facilitate the discovery, scaling, and deployment of technology solutions that support the financial sector's ESG needs, particularly on the data front.
The BIS Innovation Hub is another key player in Singapore's fintech landscape. It is conducting various multi-CBDC platform experiments across its Swiss, Hong Kong, and Singapore centres, including Project Jura, Project mBridge, and Project Dunbar.
To address the inefficiencies in linking countries' faster payment systems, MAS has begun linking Singapore's PayNow with other countries' systems, such as Thailand's PromptPay, India's Unified Payment Interface, and Malaysia's DuitNow. Recognising the need for a multi-lateral solution, the BIS Innovation Hub's Singapore Centre is developing Project Nexus, a central platform for efficiently linking up countries' faster payment systems.
Project Nexus aims to clear transactions in 60 seconds on a 24/7 basis with lower costs at less than 3% of the transfer value. It also includes banks as well as non-bank financial institutions, offering wider access to users. ASEAN countries share a vision of a multilateral network of payment linkages by 2025, and Project Nexus can be a key enabler for this.
Securely-backed stablecoins like the USD Coin and Pax Dollar, issued by fintech players Circle and Paxos respectively, are expanding their networks and partnerships with traditional finance firms. Visa has integrated popular stablecoins into its payment services, allowing users to make international payments in USD Coin.
Both Project Greenprint and the ESG Impact Hub are open-ended, collaborative platforms for financial institutions and fintech players from around the world to connect, collaborate, and co-create innovative solutions to advance the sustainability agenda. Singapore's commitment to fostering a vibrant ESG fintech ecosystem spans across countries, positioning it as a global leader in fintech innovation.
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