The central bank has formed a new work group to develop strategies and formulate regulation around the use of new technologies in financial services.. Read more at straitstimes.com.
Regulation can have a huge impact on startups, and especially Fintech startups. Usually people think that Fintech startups have an edge because they are less regulated than traditional finance, but I think that it’s not the case anymore – any entrepreneur who wants to build a world-class company now has to integrate regulatory concerns in his business plan.
However, it’s very difficult to know what is the regulatory framework in a field that doesn’t exist! For example, crowdfunding, p2p lending, digital currencies, etc. are very new concepts that do not fit neatly into any existing regulations. I was therefore very impressed by the initiative of the UK regulator last October who basically said:
– They want to promote innovation
– Innovation often comes from startups
– Startups do not have the means to spend money on lawyers, etc.to understand regulations which are still changing
– The FCA therefore set up a group for startups to have a direct line to the regulator – to address regulatory issues from outset
At pretty much the same time, Singapore was also looking at ways to make Singapore the hub for Fintech in Asia – with an investment of Infocomm in StartupBootCap, representatives of MAS in London discussing with the FIntech ecosystem, etc
This initiative from MAS – very similar to the FCA’s last year – is therefore very impressive too, and this is exactly what is needed to build a strong framework for FIntech in Asia.
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