Third, traditional financial institutions in Asia have embarked on a digitalisation journey, enabled by core technologies such as cloud computing. Almost every major financial institution has an active innovation agenda to strengthen its business by harnessing technology. In just the last three years, more than 30 global financial institutions have set up innovation labs in Singapore, testing new technologies and collaborating with FinTech start-ups to develop solutions. Let me give some examples of collaboration from the Singapore FinTech ecosystem: 2/4  BIS central bankers' speeches  Hedge fund managers are using a solution deployed by SQREEM to provide them behavioural insights related to equities, foreign exchange markets or political events like Brexit. Relationship managers are using a solution by AIDA, to predict whether their clients are likely to increase their assets under management or make a withdrawal. FINQUEST is using big data analytics to connect small to mid-sized companies globally to growth capital and potential acquirers. APVERA is helping enterprises detect anomalies in the behaviour of their employees and flag data leakage risks. These three driving forces – FinTech start-ups, e-commerce platforms, and financial institutions harnessing technology in a big way – are creating the synergies that power Asia’s digital transformation. Initiatives to Foster the FinTech Ecosystem MAS has an active and wide-ranging FinTech agenda. In the interest of time, let me highlight three key initiatives we have taken in recent years to nurture the FinTech ecosystem in Singapore and integrate it across ASEAN. First, the ASEAN Financial Innovation Network, or AFIN for short.

In short: to maintain its position as one of the top financial centres in the world, Singapore must embrace FinTech – harnessing its benefits, managing its risks. Thus began Singapore’s FinTech journey. And by FinTech, I mean two things: encourage and support financial institutions to experiment and harness technology; and promote non-financial FinTech players to provide competition and inject innovation so that the ecosystem as a whole benefits. MAS takes an even-handed approach, allowing competition between financial institutions and non-financial FinTech players as well as facilitating collaboration among them. And of course, doing all this with a keen eye on managing the risks associated with technology – safeguarding financial stability and maintaining public confidence. MAS and the financial industry are not doing this in a vacuum, but within the larger context of Singapore’s Smart Nation agenda – to build a digital economy and society for higher productivity and more gracious living. Asia’s Digital Transformation  1/4  BIS central bankers' speeches  Singapore’s Smart Nation drive is itself playing out against the backdrop of a dynamic Asia on the cusp of a digital revolution. Asia remains the fastest growing region in the world, with the ASEAN-4 economies 1 expected to grow at 4.7% p.a. over the next 10 years, China at 5.7%, and India at 6.5%. Growing affluence, rapid urbanisation, and expanding education, are propelling strong demand for modern services like travel, shopping, and financial services. Yet large segments of Asia’s population have no access to banking and payments services, insurance cover, or investment opportunities.