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Singapore Fintech Report 2021: Blockchain Dominates Singapore’s Fintech SceneSingapore’s fintech industry continued its momentum in 2020 on the back of newregulations, fintech initiatives from regulators themselves and theintroduction of the city state’s very first digital banks, according to theSingapore Fintech Report 2021 produced by Fintech News Singapore inpartnership with Alibaba Cloud.The Singapore Fintech Report 2021, released in January 2021, which can bedownloaded here, looks at the state of the fintech industry in Singapore,highlighting the key developments made in 2020 that are set to shape theindustry for the year to come.The report indicated that 2020 was a fruitful year for Singapore’s fintechstartups which continued to grow and attract funding. Fintech investment inSingapore reached US$346 million in 2020, representing 6.2% of all that wasraised in Asia.The sector continued to mature and consolidate with several acquisition dealstaking place last year including the purchase of robo-advisory fintech Bentoby Grab, and the merger of insurtech player Singlife with Aviva Singapore.The year also saw the granting of four digital banking licenses. Two digitalwholesale bank licenses went to Ant Group, and a consortium comprisingGreenland Financial Holdings, Linklogis Hong Kong and Beijing Co-operativeEquity Investment Fund Management, and two digital full bank licenses wereawarded to the Grab-Singtel consortium and tech giant Sea.These four digital banks will not have traditional brick and mortar branchesbut will market their services and operate almost exclusively online. They areexpected to shake up the banking industry by applying cutting edge technologyto serve financially excluded population. Singapore’s digital banks are set tostart business from early 2022.In 2020, Singapore showed its commitment to open banking with the MonetaryAuthority of Singapore (MAS) and the Smart Nation and Digital Government Group(SNDGG) launching the Singapore Financial Data Exchange (SGFindex). Theinfrastructure makes use of Singapore’s National Digital Identity (SingPass)to allow citizens to obtain their financial information from differentfinancial institutions and government agencies.Leveraging SGFinDex, Singaporeans can consolidate all of their financesthrough financial planning services offered by financial institutions as wellas through MyMoneySense, a free financial planning digital service offered bythe Singapore government.## Singapore Fintech Report 2021: Blockchain takes center stageOne fintech vertical that has risen to prominence in Singapore is blockchainand cryptocurrency, which now dominates the local fintech scene.Out of the 430 fintech startups identified in Singapore, 19% operate in theblockchain and cryptocurrency vertical, making it the biggest segment, aheadof payments (16%), investments and wealthtech (14%), and regtech (11%).2020 saw the city state show support for the sector with the launch of a newS$12 million blockchain research program. The Singapore Blockchain InnovationProgram aims to accelerate the development and adoption of the technology, andwill engage close to 75 companies to conceptualize 17 blockchain relatedprojects within the next three years in sectors starting with trade andlogistics, and supply chain.The year also saw the Payment Service Act (PSA) come into effect, requiringcryptocurrency businesses to obtain a license from MAS to comply with anti-money laundering/combating the financing of terrorism (AML/CFT) regulations.Singapore’s new legislation has been praised for providing regulatory clarityon the emerging asset class and industry, and could potentially lure companiesin the space into setting up shop in the city state.## Singapore Fintech Report 2021: Overview of MAS’ payments modernisationeffortsIn the payments space, Singapore continued to modernize its paymentinfrastructure in 2020, with a main area of focus being interoperability andreal-time transactions.MAS said in November 2020, that starting from February 2021, eligible non-bankfinancial institutions in Singapore will have direct access to PayNow andFAST, the country’s retail payment platforms, through a new API paymentgateway.From a customer’s perspective, this means that e-wallet users will soon beable to make funds transfers between bank accounts and across differente-wallets. Currently, most e-wallets can only be topped up via credit or debitcards, and funds cannot be transferred between e-wallets.Singapore has also been working with neighboring countries to connect retailpayment infrastructures. In December 2020, MAS announced that the linkagebetween Singapore and Thailand’s national faster payment systems willofficially go live in mid-2021. The project, which has been in the works forthree years, will connect Singapore’s PayNow system with Thailand’s PayPromptto make cross-border payments cheaper and faster.MAS managing director Ravi Menon has said that the regulator was interested inworking with other central banks in the region to expand the linkage acrossSoutheast Asia.## Singapore Fintech Startup Map 2020Download the full Singapore Fintech Report 2021 here