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In 2024, Singapore continued to cement its position as a global fintech leader. The year was marked by near-universal adoption of cashless payments and milestones in cross-border payment linking initiatives, most notably through Project Nexus.
New crypto regulations came into effect, introducing requirements related to anti-money laundering (AML), countering the financing of terrorism (CFT) and financial stability, reflecting Singapore’s commitment to promote innovation in the crypto and tokenization space.
Emerging technologies such as artificial intelligence (AI) and blockchain are being rapidly adopted, with generative AI becoming a crucial tool for financial institutions.
Finally, the fintech startup ecosystem continued to diversify, a trend evident in the rapid growth of Web 3.0, insurtech and ESGtech verticals, supported by regulatory guidance and targeted incentives, and reflecting the increasing maturity of the sector.
Cross-border payments and digital progress in Singapore
Singapore has made progress in digital payments and new challenges in cross-border interoperability. More than 90% of the population has signed up for the country’s digital payment systems, and almost all merchants – approaching 100% – are using QR code payment systems, said Chia Der Jiun, managing director of the Monetary Authority of Singapore ( MAS).
Internationally, Singapore has also made progress in cross-border payment connections with countries such as Thailand, Cambodia, Malaysia and India. However, these bilateral ties are labor intensive, a challenge that is being addressed Project Nexus. Project Nexus is a collaborative initiative with the Bank for International Settlements (BIS) that aims to create a multilateral framework and ensure that one country’s instant payment system connects seamlessly with those of other countries through a single, streamlined integration.
Singapore is delving into tokenization efforts
In April MAS extensive the scope of regulated payment services, by introducing requirements related to anti-money laundering and combating the financing of terrorism, user protection and financial stability for providers of digital payment token services.
These changes to the Payment Services Act (PS Act) bring several activities within the scope of the framework, including providing custodial services for digital payment tokens and facilitating the transfer of these tokens between accounts and facilitating their exchange.
These regulatory developments are similar to those in Singapore efforts to accelerate tokenization. Key MAS initiatives driving this acceleration include:
- The Guardian Wholesale Network Industry Group, a commercial network supporting the scaling of asset tokenization testing;
- The Global Layer One (GL1) initiative, which aims to promote the development of a publicly approved foundational digital infrastructure on which commercial networks can be deployed;
- The Guardian Fixed Income Framework, which integrates bond data taxonomy, token standards and design principles for tokenized securities, enabling a standardized approach to tokenization in the fixed income market;
- The Guardian Funds Framework, which provides recommendations for establishing a framework for symbolizing the fund’s life cycle and activities; And
- The Singapore Dollar (SGD) Testnet, which provides financial institutions with access to common settlement assets for market testing purposes.
Stimulate the growth of fintech through financial support and talent development
In 2024, there was also the government of Singapore launch several initiatives to strengthen its global leadership in fintech. These initiatives include:
- A SG$2 billion boost for the Financial Sector Development Fund (FSDF): This funding aims to accelerate technology adoption, support talent development and upskill the workforce to meet the demands of the fintech industry.
- A SG$3 billion commitment to the Research, Innovation, and Enterprise 2025 (RIE2025) plan: This boost is intended to support investments in research, innovation, and entrepreneurship at approximately 1% of gross domestic product (GDP).
- Enhanced Business Finance Scheme (EFS): The EFS has been updated to better support operational cash flow needs, with the maximum loan amount increased to SG$500,000.
- Enhanced PACT Program for SMEs and Startups: The strengthening of this program is a strategic step designed to directly address and reduce the barriers faced by small and medium-sized enterprises (SMEs) and startups in today’s competitive market by promoting partnerships between large companies and smaller companies.
- Expanded SkillsFuture Initiative: This initiative focuses on upskilling the workforce to meet the changing demands of the fintech industry.
The fintech industry is seeing increasing adoption of technology
Singapore’s fintech sector is embracing transformative technologies such as artificial intelligence (AI), blockchain and quantum computing.
According to A survey of more than 160 Singaporean fintech companies by PwC Singapore and Singapore Fintech Association (SFA) shows that 43% of respondents prioritize emerging technologies, ensuring their competitiveness in an increasingly digital world. This signals not just a trend, but a fundamental shift in the way fintech companies are reshaping their offerings and their role in the global economy, the report said.
Generative AI (genAI) in particular has seen enormous adoption. The Singapore Tech Talent Report 2024 from the SFA and Accenture reveals that 89% of financial institutions are exploring or have implemented GenAI, while 65% are actively using it – an increase of 27% from 2023.
Singapore continues to lead the way in fintech financing
In 2024, Singapore continued leading fintech financing in ASEAN. In the first nine months of the year, Singapore’s fintech companies raised $745 million in funding, accounting for 53% of fintech funding and 62% of deals in Southeast Asia.
The amount represents a slight decrease from $767 million secured during the same period last year, demonstrating the resilience of Singapore’s fintech industry despite global financing challenges.
Share of financing and deals by country, 2023 vs 9M 2024, Source: Fintech in ASEAN 2024, UOB, PwC Singapore, Singapore Fintech Association (SFA), November 2024
Major funding rounds in 2024 include:
- GXS – US$280 million (2 rounds)
- Anext Bank – $148 million
- Partior’s $60 million Series B;
- SDAX’s $50 million Series B;
- NIUM’s $50 million Series E; And
- Sygnum’s $40 million Series B.
Singapore is home to six of Southeast Asia’s seventeen fintech unicorns. These unicorns are Advance Intelligence Group (valued for $2 billion), Bolttech ($1.5 billion), Amber Group (3 billion dollars), Coda Payments (2.5 billion dollars), Matrixport ($1.05 billion) and NIUM ($1.4 billion).
List of ASEAN-6 unicorns, Source: Fintech in ASEAN 2024, UOB, PwC Singapore, Singapore Fintech Association (SFA), November 2024
Featured image credit: edited from free