tharman shanmugaratnam : financial technology ( fintech ) transforming financial services in singapore speech by mr tharman shanmugaratnam, chairman of the monetary authority of singapore, at the launch of lattice80, singapore, 10 november 2016. * * * introduction 1 good morning. thank you for inviting me to join all of you. let me begin by congratulating marvelstone on the launch of lattice80. 2 it is the first innovation space in singapore dedicated to and designed specifically to support fintech. lattice80 is also the first not - for - profit private sector initiative in this business of nurturing start - ups. the fintech phenomenon 3 fintech – or financial technology – is transforming financial services, both from within established financial institutions and from outside the regulated sector through new, fintech players. 4 when fintechs first came to global prominence, it was tempting to cast this as a battle between new, innovative and responsive players and lumbering, flat - footed banks and other financial institutions. 5 the real picture is more nuanced, mainly because the incumbents have not been sitting still : many of them are investing heavily in technology to streamline and optimise entire swathes of operations. for example, several initiatives are underway among banks to tap on distributed ledger technology to achieve swift, seamless and secure trade settlement. several financial institutions have set up in - house fintech units to replicate the start - up culture. they are also collaborating with and, in some instances, buying over promising fintech companies. 6 and not many technology companies aspire to become financial institutions. complying with regulations, submitting to supervision, and churning out disclosure documents for the markets is not always an appealing prospect. 7 in short, the goliaths of the financial world have become more nimble - footed, and are both competing with and partnering the davids. 8 that said, we are still at an early stage of fintech, globally. it has spurred greater competition in every segment of the value chain of finance. it is too early to say who the winners will be. 9 the traditional financial institutions have the advantage of scale and a reputation amongst customers. but those that fail to keep up with technology will see part or all of their business models disrupted. consumers are cautious about shifting their wallets to new players, but they are also looking out for services that offer the best value. 10 but many fintech start - ups will also fail. it is

. 15 let me cite two fintechs starting up residence here in lattice80 : percipient, a local start - up, has successfully developed a customised digital solution for the state bank of india. percipient ’ s big data technology allows for efficient management of the bank ’ s database of over 500 million accounts, and translating into large potential cost savings. sparks systems builds new generation trading platforms for hedge funds, banks, financial institutions and other high volume institutional participants in the foreign exchange market. it aims is to develop an efficient market place for emerging market fx. 16 this innovation village also promotes collaboration and co - creation. even in an age of tweets and snapchats, face - to - face interaction remains a source of new ideas, and a way to suss out potential partners. 2 / 3 bis central bankers'speeches r3 lrc, a specialist in distributed ledger research supported by a consortium of more than 70 financial institutions, will set up its first physical presence here. r3 asia lab will promote the cross - pollination of ideas between singapore fintechs and leading technologists around the world. the fintech association singapore, another resident here, is a cross - industry initiative to facilitate collaboration among all stakeholders in the fintech ecosystem. 17 there is another feature to this collaboration here, which is to bring start - ups together with venture capital and other investors. tryb is an investor in promising technology start - ups that are building the financial infrastructure platforms of the future for asean. tryb is currently in the process of raising us $ 100 million in long - term funding. the marvelstone group too, has been investing in fintech start - ups and linking them up with their network of business and specialist expertise. further mas initiatives to grow vc activity 18 mas is working with the vc industry to grow the funding landscape for start - ups in singapore and the region. the role vcs play in stimulating economic dynamism has been a recurring theme in discussions of the committee on the future economy ( cfe ). 19 there are two key prongs in mas ’ approach. 20 first, mas is reviewing its regulatory regime for vc managers. specifically, mas is looking to significantly simplify and shorten the authorisation process for new vc managers. further, to the extent that there are contractual safeguards to provide sufficient protection to a vc ’ s sophisticated investor base, mas is also looking to exempt vc managers from business conduct requirements that are currently