Pandemic Causes Digital Banking Delays
(14 April 2020 – Singapore, Hong Kong) The Monetary Authority of Singapore (MAS) has extended the assessment period for approving digital bank licences to the second half of this year from June previously, citing the global escalation of the COVID-19 pandemic.
Singapore’s central bank has received seven applications for digital full bank licences, which allow retail operations, and 14 applications for digital wholesale bank licences. The regulator is to issue two digital full bank and three digital wholesale bank licences.
The city state is not alone in delaying digital banking assessment in the region. Hong Kong had earlier on earmarked February this year for the final launches of its eight virtual banks.
To date, no licensed digital lenders have fully kicked off for business, except for ZA Bank. Of the seven remaining virtual banks, three have made soft launches for trials including Ant Bank, Airstar Bank and Mox, while the remaining four – WeLab Virtual Bank, Ping An OneConnect Bank, Fusion Bank and Livi Bank – have yet to announce any launch dates.
“The outbreak of COVID-19 has inevitably affected the virtual banks’ preparation for the launch of the business,” according to a statement from the Hong Kong Monetary Authority (HKMA).
“The extension will also enable MAS to focus resources on ensuring monetary and financial stability, and ensuring that financial institutions remain resilient and able to perform their role in supporting businesses and individuals through this challenging time” the MAS released in a statement.
Some incumbent and challenger banks in the region are, however, proactively preparing for the completely new post-COVID paradigms.
“We are doing a lot of post-COVID prep research with clients currently, acting to place them on the front foot for recovering market and client opportunities. It really is working very well” said Sangiita Yoong, East and Partners Asia Business Head.
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