Impact of FinTech On the Lives of Consumers in Singapore
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Demystifying FinTech
The finance sector has a reputation of being ingrained in their traditional ways, being nearly impervious to change. Financial institutions and services tend to involve a lot of paperwork, but things have changed in the past couple of decades. Customers use PayPal these days to securely handle all of their online transactions as they make online purchases. You might not be able to name another electronic financial service as ubiquitous as PayPal, but they do exist. They are gaining popularity all over the world, and Singapore is becoming a global hub for financial technology innovation.
A handful of Singaporean FinTech startups has attained prominent success in recent years, with the likes of Xfers, Dragon Wealth, and Call Levels. However, there is still potential for more companies to prosper. As a result, Singapore is investing many resources in this particular sector. The government wants to see more FinTech initiatives from entrepreneurs. Ultimately, this will help consumers tremendously. We want to show you how FinTech has changed of lives of everyday Singaporeans and explain the FinTech industry.
FinTech is a portmanteau of two words – financial and technology. It describes the emerging financial services sector that rose to prominence in the earlier part of the 2010s. FinTech is changing the way we do business. Paypal is a very good example of a FinTech concept that many people in Singapore use quite regularly.
Several FinTech technologies exist, such as online payments and transactions as well as data management and security. Numerous Singaporean companies are investigating these issues to make them available to consumers.
Ultimately, it is all about consumers and the way in which they receive benefits from the advancements in financial technology. Traditional methods of conducting financial activities are dying, and they are being replaced by more modern, technological methods.
We will look at some of the major FinTech applications and the way in which Singapore is adopting these technologies.
Mobile Banking and E-Commerce
For consumers, financial technologies like mobile banking and e-commerce are very helpful. People are constantly on the go in a metropolis like Singapore. Many do not conduct their online banking from their home. In Singapore, many people make their financial transactions on the phone while they are sitting in the metro, making good use of their time. Many banks in the nation already have such features in place to allow it; they have mobile apps that make it very easy for customers to conduct online banking transactions.
Mobile Payment Solutions
Further financial innovations have led to the concept of a mobile wallet, also known as a digital wallet. Apple and Google are spearheading the movement for mobile payment solutions and systems with their Apple Pay and Google Wallet applications. They bring your wallet or purse onto your phone and truly digitalize the flow of cash.
Both of these mobile payment solutions rely on contactless payment using near field communications (NFC) technology. Singapore officially authorized the use of NFC nationwide a couple of years ago, and consumers have been “tapping” their phones everywhere. They tap their phones as they board trains and hop on buses instead of using their older EZ-Link transportation cards.
Many shoppers have even started to use their NFC-enabled phones to pay for goods with digital wallets. Singapore is soon becoming a cashless society with this revolutionary contactless payment scheme, all thanks to FinTech.
The Government’s Strategy
FinTech has already changed the way consumers in Singapore behave and conduct their business in their daily lives. It will only keep changing with new FinTech companies and products emerging from the biggest technology hub of Southeast Asia. The Monetary Authority of Singapore (MAS) has expressed a deep desire to foster and grow the financial technology sector in the country. It is an integral component of its Smart Financial Centre initiative.
As awe-inspiring as it is to have such remarkable financial technologies available to the public, there are still the looming concerns of data integrity and cyber security. There is always the threat of hackers and data thieves stealing sensitive personal information as people use these FinTech apps.
To ensure that people are protected, the government of Singapore has agencies that collaborate with financial companies. They get FinTech firms in touch with engineers and Big Data specialists to guarantee high levels of cyber security.
What does this mean for the regular consumer? Consumers can use these products with the peace of mind that their personal and sensitive data is never at risk from being stolen or put in jeopardy.
The Rapid Growth of FinTech in Singapore
Recent reports have shown that the interest in FinTech in Singapore has spiked in the past year alone. Millions of dollars are being invested in startups that are looking to shake things up in the world of financial services.
In 2015, the entire continent of Asia raised nearly $800 million in funding for FinTech startups, making it the second highest funded region in the world for startups, close behind the United States. FinTech investment in Asia in the year 2015 reached $4.3 billion!
A big chunk of that funding was from Singapore, and this tiny country is leading the way in FinTech development in Asia.
Here are some fascinating FinTech startups that are gaining popularity in Singapore.
Numoni
A mobile application that allows people to use cashless payments without actually having a bank account themselves. People fill up their account on Numoni with cash, vouchers, credits, or anything of that nature and spend their resources through Numoni.
HomePay
An app targeted for families to give them a chance to keep track of their spending. Users can set spending limits and notifications when they spend a certain amount. The app provides detailed insight of expenditures across various spending categories.
Tradehero
This application lets users trade virtual money and allows them to bet on the real-world stock exchange. Although it is a game, it lets aspiring investors get their feet wet with the whole stock exchange business before they eventually decide to take bigger risks with real money.
Conclusion
With numerous up-and-coming FinTech companies in Singapore, consumers will soon be able to do things like lend money, make payments, invest money, and manage and analyze personal finances – all from an app on their phone.
The future is FinTech. The future is here.