This means harnessing technology to increase efficiency, manage risks better, create new opportunities, and improve people’s lives If Singapore is to maintain its position as one of the top financial centres in the world, it must embrace FinTech – maximising its benefits, minimising its risks. STRATEGIES FOR A SMART FINANCIAL CENTRE And so, for the last two to three years, the Monetary Authority of Singapore (MAS) has been working together with the industry to foster a thriving FinTech hub. This requires getting several pieces right: an ecosystem of diverse players competing and collaborating; an open architecture economy that enables connectivity and innovation; a web of international links to promote the exchange of ideas and scale solutions; a strong talent pool and deep research capabilities; 1/9  BIS central bankers' speeches  a conducive regulatory environment; and a safe and secure cyber environment. Ecosystem of Diverse Players We want to create an ecosystem for innovation, where established financial institutions and FinTech start-ups compete as well as collaborate. Financial institutions are no longer the laggards and technology dinosaurs of popular myth. I know this from my conversations with CEOs of global banks and insurance companies. Almost every major financial institution has an active innovation agenda to strengthen its business by harnessing technology. Many CEOs today can carry on an intelligent conversation about blockchains without looking at their notes – this is a big change from just two years ago. Singapore wants to be the place where these financial institutions test, develop, and apply new technology solutions.

I suspect, increasingly, we will have to take a more risk-specific approach and an activitybased approach with respect to FinTech. This means: Setting thresholds for when regulation kicks in; calibrating regulatory requirements to specific risks; and applying these requirements to activities rather than entities. A good example of our attempt to do this is the new Payment Services Bill, which we will publish for public consultation next week. Our aim is to right-size the regulations, to fit the various new developments that are taking place in electronic payments. Licensees will be regulated according to the activities they conduct, because different activities pose different risks. Finally, there are areas – be it new technologies or new business models – where regulators will never know enough. This is where the regulatory sandbox comes in – to facilitate experimentation in a contained environment. 4/9  BIS central bankers' speeches  Cyber Security Finally, cyber security. As we go more digital and online, cyber risks will mount. And if these risks are not managed well, public trust and confidence in technology will suffer. To fully harness the benefits of digital technology, we must build robust cyber defences and have effective remediation plans when things go wrong. First, cyber surveillance and information sharing. We are pleased to see the official launch in Singapore of the Asia-Pacific Regional Information & Analysis Centre by FS-ISAC. FS-ISAC, or the Financial Services Information Sharing and Analysis Centre, is a global intelligence gathering and sharing initiative for the financial sector, with over 7000 members worldwide.