Prime Minister's Office (Monetary Authority of Singapore)

The Singapore economy is going through its most severe downturn since independence. The Monetary Authority of Singapore (MAS) seeks to anchor economic and financial stability, and support businesses and individuals in riding out the COVID-19 crisis. MAS is also positioning the financial sector to emerge stronger, so that it can continue to support the economy and provide more good jobs for Singaporeans.

MAS has adopted an accommodative monetary stance, to complement the Government's significant fiscal policy measures in mitigating the economic impact of the COVID-19 Circuit Breaker and broad-based decline in global demand. MAS eased monetary policy in April this year to prevent a broadening of disinflationary pressures that would be destabilising for the economy. Through its money market operations, MAS has and will continue to ensure the smooth functioning of funding markets in Singapore, so that there is no disruption to banks' ability to continue to extend credit to the economy.

Sustaining the safety and soundness of our financial sector is critical for supporting the economy through the downturn as well as its recovery. Banks and insurance companies generally entered the crisis with financially strong balance sheets. MAS' stress tests found them to be resilient in a deep downturn. Singapore's financial sector has also demonstrated strong operational resilience and has been able to continue to serve customers through the different phases of the COVID-19 pandemic. This has reflected years of investments in digitalisation, sound business continuity planning and agile adjustments to work processes. To ensure that financial institutions stay resilient financially and operationally, MAS has provided a number of regulatory reliefs that do not compromise prudential standards, and will continue to supervise the industry closely.

MAS and the financial industry introduced a comprehensive package of measures that have provided relief to individuals and businesses in meeting their loan and insurance commitments, and helped ensure continued access to bank credit and insurance coverage. As the measures provided temporary relief and come with longer term costs, they need to be gradually withdrawn. MAS is working closely with the industry to ensure a well-paced exit that minimises sharp cliff effects for borrowers, while safeguarding financial stability.

The financial sector remains integral to Singapore's recovery from the COVID-19 crisis and longer term growth. MAS will work with the industry to ensure that the financial sector is well-equipped with the skills and capabilities to emerge stronger from the crisis, and advance Singapore as a global financial centre. The financial sector is on track to meeting its targets for both growth and job creation that were set out in our 5-year Industry Transformation Map for 2016 – 2020.

MAS takes a comprehensive approach, working closely with tripartite partners to support the reskilling and upskilling of the local workforce, and create jobs and traineeship opportunities in the financial sector for fresh graduates and mid-career workers. We are also working with major financial institutions (FIs) to ensure a solid Singaporean core in their workforces, complemented by diverse and high quality manpower. These efforts include developing a strong pipeline of Singaporeans for senior responsibilities in the sector.

In April 2020, MAS launched a $125 million support package, which included enhanced subsidies for training and manpower costs in the financial services and FinTech sectors. The package will enable structured talent development programmes for more than 900 Singaporeans among those newly hired by FIs over the next three years. FIs have also committed to hire significant numbers under the various SGUnited Jobs & Skills programmes. Close to 60 FIs have offered close to 1,300 SGUnited traineeships to fresh graduates.

To prepare local mid-career workers for new or transformed roles, MAS is working closely with the Institute of Banking and Finance and Workforce Singapore to train and redeploy workers into financial institutions. For example, more than 200 attachments have been offered by 18 FIs this year under the Technology in Finance Immersion Programme, in growth areas such as artificial intelligence, cloud computing, cybersecurity, and data analytics.

Following five years of investments in digital transformation and innovation by financial sector players, Singapore is now widely regarded as one of the top FinTech hubs globally. An estimated 1,000 FinTech firms are based here. MAS recently announced a $250 million enhanced Financial Sector Technology and Innovation Scheme, or FSTI 2.0, to accelerate technology and innovation-driven growth in the sector. The Singapore FinTech Festival and Singapore Week of Innovation and Technology later this year will deliver the world's first week-long round-the-clock, hybrid digital and physical event for attendees across the world, and will bring together the global innovation community despite the current travel constraints.

With the accelerated pace of digitalisation due to COVID-19, MAS is also working actively with other government agencies and the industry to drive further progress on electronic payments and digital banking. In addition, MAS will work with the financial services and FinTech sectors to adopt digital solutions that will strengthen operational resilience, improve productivity, better manage risks, as well as engage customers. Achieving a high degree of digitalisation will be a key source of competitive advantage for our financial sector in the future.

Safeguarding the environment and managing climate-related risks is an increasingly important issue both globally and in Singapore. MAS set out our vision for Singapore to be a leading global centre for green finance last November. We have made good progress and will continue to press on with all three pillars of our Green Finance Action Plan, to strengthen the financial sector’s resilience to environmental risks, develop green finance markets and solutions, and harness technology and innovation to promote green finance.

The financial sector plays a critical role in supporting Singapore through the downturn as well as its recovery. MAS' priorities are to ensure monetary and financial stability, support individuals and businesses to tide through the crisis, and position the financial sector for recovery and future growth. MAS is working closely with the financial services and FinTech sectors to achieve these aims and help Singapore emerge stronger from the crisis.