Fintech investment in Singapore reaches US$61.5m as global funding doubles

The Monetary Authority of Singapore (MAS), has been at the forefront of driving majority of fintech activity.

Singapore economy expands by 1.8 per cent in Quarter 1
The skyline of the central business district in Singapore Reuters

Singapore continues to be a major fintech hub globally, with investment in the tech reaching US$61.5 million despite the drop in deals closed during the past quarter. According to KPMG Pulse of Fintech report, historical data shows that the apparent decline could be a result of the move towards a more partnership-oriented fintech model in Singapore.

The city-state's central bank and regulator, the Monetary Authority of Singapore (MAS), has been at the forefront of driving majority of fintech activity. In the past quarter, the central bank shifted its focus from education and innovation to promoting technology adoption and attracting firms to launch their offerings in Singapore.

KPMG Singapore Head of Financial Services Advisory Chia Tek Yew said the regulator is eyeing more firms to use the city-state as a test bed for their new solutions. "Over the longer term, MAS hopes to see more fintechs using Singapore as a base to pilot and then deploy solutions into other countries within Southeast Asia, such as Indonesia and Thailand. The success of these cross-border solutions could prove the viability of using Singapore as a springboard for Asia-based expansion," he said in a statement.

One key trend that brings players on their toes is the blockchain technology. Tek Yew pointed out that this would be a hot area of investment across much of firms based in Asia.

"There seems to be a major push to transform Singapore into the world's blockchain leader, with an ever-increasing number of use cases in the country aimed at testing blockchain in government trade, land registry and tax functions, in addition to traditional banking and insurance," he noted.

The growth in fintech investment in Singapore came with the global rebound. The KPMG report revealed that global fintech grants more than doubled in the past quarter, hitting US$8.4 billion.

The global mergers and acquisition investment boosted the fintech market rebound, with US$5.9 billion in deal value in the said quarter. In terms of venture capital funding, investment declined slightly, with just over US$2.5b raised by players.

In Asia, total investment remained steady, managing to record US$760 million funds injected across 51 deals in the period.