Implementation of Smart Nation and Cashless Payment for Public Services

Ms Tin Pei Ling asked the Prime Minister how does the Government plan to help the elderly get ready for a Smart nation and not be left out in our endeavour towards a cashless future.

Mr Liang Eng Hwa asked the Prime Minister (a) what are the upcoming areas of public services that the Government plans to implement cashless payments; (b) how will the Government help seniors who may have difficulties adopting e-payments in those areas; and (c) how can the overall costs and charges of e-payments be lowered for the merchants and end consumers.

Miss Cheng Li Hui asked the Prime Minister (a) if he can provide an update on the Smart Nation programme; (b) whether there are plans to bring pervasive technologies into the daily lives of Singaporeans; and (c) how does the Government intend to achieve its Smart Nation vision moving forward.

Mr Low Thia Khiang asked the Prime Minister (a) whether there will be an effort to identify any potential increase in security and personal safety risks that arise from an increase in electronic payment options, including scamming, loansharking and blackmail; and (b) what steps are being taken to monitor these risks, inform the public and mitigate these risks.

Sir, the Smart Nation and Digital Government Group has identified an initial tranche of five Strategic National Projects (SNPs). Each has a timeline for delivery that includes intermediate milestones. For example, under e-payments, the Payments Council has set up an industry task force to establish a common Quick Response (QR) code standard for Singapore, or SGQR, by the end of 2017.

While critical to the Smart Nation's success, these and future SNPs are not outcomes in and of themselves. We do not chase technology for technology's sake. Instead, we must be people-centric, as Dr Tan Wu Meng has said. There are three levels of outcomes that we strive for under Smart Nation.

First, at the individual level, Smart Nation must bring about practical convenience and a higher quality of life. For example, PayNow enables Singaporeans to pay one another, across accounts held in different banks using just the recipient's mobile number.

Next, at the enterprise level, Smart Nation must boost efficiency, reduce costs and stimulate business. The Monetary Authority of Singapore (MAS) and the banking industry are working to extend PayNow to merchants and companies. The SGQR will provide merchants with an infrastructure-light and cheaper alternative to accept different types of e-payments, including PayNow.

Finally, at the economy and societal level, Smart Nation is about opportunity. There will be new ways of doing things, new forms of businesses and new jobs. Businesses will be transformed through end-to-end digitalisation of their processes. Digital platforms will allow our enterprises to tap new markets. The Government will keep standards and platforms open so that as many enterprises as possible can take advantage of the opportunities. We have been and will continue to actively work together with the private sector.

To achieve these outcomes, Smart Nation needs to be a whole-of-nation endeavour. This means benefiting and involving all segments of the population, including the elderly.

We must strive to provide digital options that are user-friendly for all. For example, the Post Office Savings Bank (POSB) is working with some primary schools to explore child-friendly e-payment options, from wearables to biometric payment. We should similarly develop solutions to help the elderly embrace e-payments and other digital opportunities.

We must be a nation of smart users and exploiters of technology. We should neither blindly adopt technology nor shut it out and refuse to change. This requires us to be prepared to try new things and pick up new skills. Reskilling is not easy but it is necessary, which is why we have put in place SkillsFuture and programmes, such as the Infocomm Media Development Authority's (IMDA's) TechSkills Accelerator (TeSA) to help all Singaporeans be digitally ready.

We must enable digital access and we must also facilitate digital readiness to help everyone have the skills and literacy to use digital technology in a safe, responsible and confident way, and give everyone the ability and opportunity to participate meaningfully in the digital society.

Basic digital skills are something we need to equip everyone with. In the 1980s, when we saw a wave of computerisation across offices in Singapore, moving from typewriters to word processing, the Public Service took the lead through the National Computerisation Plan to implement widespread training of basic computer skills. We are now facing another major need for such a movement, and we will have to ensure everyone is equipped with a set of basic digital skills, be it for work or in our daily lives. This applies to all Singaporeans.

The Ministry of Communications and Information (MCI) has set up a Digital Readiness Workgroup with representatives from the public and private sectors who have expertise and experience in applying technology to make lives better. The Workgroup, in its recommendations, will propose strategies to improve digital readiness in Singaporeans, by early next year. These will reinforce existing initiatives, such as the Silver Infocomm Initiative (SII) by IMDA which has reached out to more than 130,000 seniors to promote information technology (IT) awareness and literacy.

An important part of being digitally ready is to understand the risks involved and to be proactive in risk mitigation. Financial institutions in Singapore have been taking measures to detect and deter cyber threats and strengthen the security of their digital platforms. MAS has set standards and expectations for financial institutions on the management of technology risks. But, as with other forms of payment, such as cash or cheque, the individual also has to exercise the responsibility to protect himself. In e-payments, there are simple steps that each of us can take to protect against fraudulent transactions or identity theft. MAS has been working closely with the banking industry and law enforcement agencies to raise consumer awareness of these measures. The Singapore Police Force (SPF) and the National Crime Prevention Council (NCPC) have also conducted several anti-scam public education initiatives over the years as well, and launched the Anti-Scam Helpline. We need to step up these efforts as we advance along the Smart Nation journey.

Sir, Smart Nation is about making all our lives easier. It is about building a strong society and economy for all, where businesses thrive, opportunities abound and we look forward with confidence to the future. Change is uncomfortable, but, if not for some of the bold, uncomfortable changes our founding leaders had the vision to make, Singapore will not be where we are today. Not only have we survived, but we have thrived. The nation-building narrative of the next generation will be about digital infrastructure as much as it is about physical infrastructure. Singaporeans are resilient enough to weather this change and will come out the better for it.

Thank you, Mr Speaker, and congratulations. Before my questions, I just want to declare my interest. I do work in a financial institution that offers payment services. Two questions.

Firstly, one of the major impediments to achieving a unified e-payment system and the interoperability is the difficulty to align the commercial interests of the different stakeholders and players, both new and incumbents. In this regard, I would like to ask the Senior Minister of State whether the Government would take a more regulatory stance, such as the payment players to collaborate with one another, or the Government may take a more developmental incentivising approach here.

Secondly, can I also ask the Senior Minister of State as there has been quite a fair bit of public interest on the submission of a proposal for a unified e-payment system by the tech company, Razer? Can I ask the Senior Minister of State the approach the Government will take in considering such a proposal and whether the Government will be looking at other proposals submitted by other companies as well?

Sir, to answer the first question, to either regulate completely or leave it completely to the free market will all have its problems. We need to have a balanced approach between complete regulation and creating opportunities for innovative solutions from a number of players, including banking and non-banking institutions.

Our role is really to ensure that there are common platforms and standards of interoperability, and then, in parallel, to make sure that all the regulations, oversight, compliance and enforcement around our monetary system and our financial system continue to be robust and relevant to both the technologies and the opportunities that the waves of digitalisation will make possible. So, we will take a balanced approach.

We have worked with a number of players to introduce PayNow. We are working to increase adoption of QR codes. We will continue to take a balance between a regulatory stance as well as developmental.

On the Member's second question about the submission of a unified e-payment system from Razer, MAS receives quite a lot of proposals and we study all the proposals carefully. But, really, we have to ensure that whoever is making these proposals, the standards are maintained. There is a common platform, a series of interoperable standards, space for competition and adherence to the regulations and compliance with the financial regulations that are already in place.

We cannot afford to lower that bar of quality in terms of risk and risk management, and we cannot afford an e-payment ecosystem that is fragmented and not interoperable. We have several proposals to do so and we will study all the proposals that are put before us.

I have two supplementary questions. I understand that the move towards Smart Nation is a future-oriented one and it is to provide the options, the foundation for those who are ready to embrace it. But again, back to the elderly, and it may not just include those who are single, lonely elderly who have no family members to support them, and, if they do not have banking accounts, just wondering whether the Government will also focus on how we can help them to have a better understanding and more trust in the system because that is one of the obstacles.

The other one is that to go cashless, one of the intermediaries is to have cards. Some of them may not know how to use cards. They may have lost it, they may have forgotten the passwords. Therefore, will we consider using biometric more, so that wherever they go, it becomes easier for them and it is also more robust in terms of identification and they can engage in these services more seamlessly?

The second part of this is a slight deviation but also relevant. As we endeavour towards Smart Nation, will the Government continue to ensure that the elderly or those who prefer face-to-face interaction will not be unwittingly shut out of the whole communication and feedback process because there is a strong reliance on the e-mode, the digital mode? But there are those who would prefer very much to rely on the face-to-face mode for communications, for example, going to a Ministry to give feedback or make enquiries. So, I would like to get the Senior Minister of State's indication on these.

I thank Ms Tin for the questions. Sir, let me start with the second part, which is the issue of the possibility of biometric systems as opposed to a card. Our general approach going forward is, rather than look at a singular form factor, whether it is a fob or a card, our general approach has been to try to look at software solutions. So, software tokens, software encryption. One of the reasons for this is that it can then be incorporated into a number of form factors. For example, if you had a phone which accepted biometric authentication, and you use that to access your software platform, that would be a different approach from someone who used a personal identification number (PIN) to access the same software. So, using software as a middle layer to allow engagements through a variety of form factors, is certainly part of the design principles of how we would do to increase adoption and utilisation of Smart Nation initiatives.

If I could use an example to answer both the first and third questions from Ms Tin, the first question was about how we could help the elderly have trust in the system and the third question was about maintaining a face-to-face interaction. I would like to use two examples. One is the Housing and Development Board (HDB) and the other is our CitizenConnect Centres. HDB has significantly digitalised much of its customer-facing processes. It has used backend software improvements, it has used user interfaces. But there is still a lot of staff in the office, in the branches, at the counters, not to remove the need for human interaction but to change the nature of that human interaction, so that when customers step in, the staff are there with tablets, with the computers, guiding potential home owners through the process and helping them to navigate the process. So, rather than having staff deal with laborious data entry or merely deal with the process management, the HDB staff have been reskilled towards customer relations.

Another example is our CitizenConnect Centres where individuals who do not have access to a computer or a phone, or do not have the confidence to deal with Government services online, can go to these CitizenConnect Centres. Most of them are located within Community Centres. Staff would be on hand.

Why have we got the solution this way? Because it means that we give people access to e-services if they do not have a computer, a phone or the confidence, but also, there is an opportunity for the staff to interact with these citizens and explain to them the process, help them onboard, perhaps teach them so that they may be able to do it next time, or if they bring along a family member, staff can teach them, and to help them develop trust in the system. So, we have used that as solution, not just to provide people access and participation, but also to try to help to develop trust in the e-services and public services that are made available through the online centres.

I thank the Senior Minister of State for his answers. I have two supplementary questions which I would like to set in context as well. Firstly, would the Senior Minister of State explore rolling out best practices across the different agencies in Government, such that residents, especially senior citizens, are aware of this opportunity to still have a human interaction encounter, even as we transition to Smart Nation? By illustration, I mention an anecdote where my resident showed me a letter from an agency, written in English, saying that e-services would replace manual forms and asking the residents to get ready with their SingPass and two-factor authentication. But some of these residents were elderly, not quite familiar, and sadly, became quite concerned.

Secondly, I was also wondering whether there would be a deliberate effort to look at ease of use of the Smart Nation's systems, even tracking small details, such as the number of clicks, the number of movements needed. The reason for this is, again, to make it easy enough that people transition without the solution being imposed on them. Because, if I may say, as part of a Smart Nation, we need smart design, inclusive design, with Singaporeans, for Singaporeans, for Singapore.

Mr Speaker, I thank Dr Tan for his questions. On the first question, which is essentially about digital inclusion, certainly, English literacy, I suspect, is as big a problem, if not a greater problem than just age, for adoption. The simple answer would be to recommend for our resident to approach the Community Centre and CitizenConnect Centre where people can help him or her access that service, conduct their online business if necessary or, if possible, teach them how to do so. We do have services which are specifically targeted at this group of people.

We are, in all our efforts, taking some extra effort to engage, to onboard people, and we are tracking the percentage of people who come onboard in our various services. But it is not going to be enough to just assume it would improve over time. There are segments of the population that we would have to reach out to especially, and we would have to think about what are the channels within the community that we can leverage to reach out to them. So, we welcome suggestions on how we can find people who are having difficulty engaging with Government services online and reach out to them better.

The second question Dr Tan asked was about the user interface. Indeed, the Government does have a set of digital service standards, so that services should have a consistent level of userability, accessibility, should be mobile-ready, websites especially. We are also increasing the use of talent in the user interface phase, so that when we do the engineering, we have people with user interface, user experience talent, looking at the design process right from the start. It is an informed part of how we make sure that people can participate.

All Government digital services must also comply with the Web Content Accessibility guidelines which are an international standard for making web content accessible to persons with disability. For example, the size of the text, the contrast ratio, providing captions, providing spoken language options as well. So, we have a variety of standards and we are taking a whole-of-Government approach to this.

Would the Senior Minister of State agree that with the rollout of Smart Nation, especially e-payment systems which will be pervasive, and especially since it will involve the elderly, the security risks and reliability of the transactions and the e-payment systems would be quite different from what he is talking about, that is, MAS' guidelines on financial institutions. Are we ready to face the challenge of security risks, in terms of e-payment, and what measures are we looking at? Is the Ministry ready to look at some of these issues and devise some system?

Indeed, Mr Low's point is spot-on. We do have to ensure that e-payments are secure and have security behind them, and people trust in them. In terms of the Smart Nation initiative moving forward, the question is what are we comparing these e-payments to? If we care comparing them to cash, then e-payments are certainly more secure. Because you can track, you can trace, you can authenticate identity and provenance and so on and so forth.

But if we are comparing them to, for example, credit cards, EZ-Link, Network for Electronic Transfers (NETs) − these are all non-cash e-payment solutions that we have had for some time. We have some experience in operating and regulating these systems and monitoring these systems, and in detecting and deterring threats and theft associated with these systems.

When we engage with citizens and, especially with the elderly, we should highlight that, actually, we have had e-payment solutions in Singapore for a long time. I have just highlighted some of them − NETS, EZ-Link, credit cards. What we do not have is a unified, unfragmented ecosystem and that is what we are moving towards. We have a lot of e-payment transactions that are occurring today. MAS has a number of systems and processes in place to detect and deter fraud as well as threats. We must increase the level of trust that we have in the security of our systems. It is a very important question and we have quite a lot of work going on in exactly that realm.