MAS Partners with India’s IFSCA to Drive Cross-Border FinTech Innovation

As part of an ongoing effort to promote regulatory collaboration, the Monetary Authority of Singapore (MAS) and the International Financial Services Centres Authority (IFSCA) have entered into a FinTech Co-operation Agreement (CA). Announced on September 18, 2022, the partnership builds on the Memorandum of Understanding on Supervisory Cooperation signed between MAS and IFSCA earlier this year. 

In a statement delivered at the CA signing, MAS and IFSCA announced that the CA will promote regulatory sandbox collaboration and information sharing. It will also encourage participation in joint innovation ventures and facilitate discussions on upcoming FinTech issues.

Cooperation Agreement objectives

By leveraging existing regulatory sandboxes in their respective jurisdictions, MAS and IFSCA aim to support emerging technology innovations. Under the partnership, both authorities will be able to refer innovative businesses to each other’s regulatory sandboxes and facilitate creative cross-border experiments across both jurisdictions. 

Additionally, the CA will allow MAS and IFSCA to analyze the suitability of use cases that could benefit from cross-border collaboration and invite relevant jurisdictions to participate in a Global Regulatory Sandbox.

Described by MAS’ Chief FinTech Officer, Sopnendu Mohanty, as a “FinTech bridge,” the CA also enables MAS and IFSCA to share non-supervisory related information and developments on innovation in financial products and services.

Forging new growth pathways

The partnership between MAS and IFSCA follows MAS’ Financial Services Industry Transformation Map (ITM) 2025 launch on September 15, 2022. In the ITM, MAS presented its growth strategies to further develop Singapore as a leading international financial center in Asia – connecting global markets, supporting Asia’s development, and serving Singapore’s economy.

Among the ITM’s five growth pillars is the enhancement of capabilities in asset classes in which Singapore plays a key regional or global role. One of the asset classes listed in the ITM refers to FinTech start-ups, particularly those operating in Web 3.0, artificial intelligence, and green FinTech. Through the CA, innovation in these areas is likely to be prioritized due to the industry’s ability to “harness technology to innovate, better manage risks, speed up and reduce costs, and create new opportunities for growth.” 

Key takeaways

Through regulatory sandbox collaboration and the sharing of non-supervisory information, the CA is designed to reduce the risk of FinTechs working in silos and viewing customers and transactions in isolation. Ultimately, this risks missing a bigger picture of criminal activity that may be going unnoticed.

Compliance teams within FinTechs looking to enhance their data sharing procedures should consider the additional resources provided by the FATF, some of which include:

• Information about Opportunities and Challenges of New Technologies for AML/CFT
• Guidance related to Stocktake on Data Pooling, Collaborative Analytics, and Data Protection
• Guidance on Digital Identity