Unicorns, million-dollar data centres, and mergers and acquisitions—these words sum up the 2018 technology scene in Singapore. In the new year, fintech (financial technology) will take centre-stage.
According to Randstad Singapore’s 2019 Market Outlook Report, even though they are technology firms by essence, fintech companies have a big commercial play in the financial service sector, especially in the island nation. A number of companies are upscaling their commercial activities in the region and venture capital funds are pouring in from around the world.
“The fintech sector in Singapore is in a hyper-growth stage. New startups and entrants are disrupting the market, and established companies are finding new and innovative ways to be more agile and flexible to stay competitive in the environment,” states the report.
High degree of innovation
Over the past few years, Singapore has become known for its fintech industry. Over 200 fintech startups operate in the region. The island nation’s financial services sector grew 4.9 percent in 2017, according to a report by the Monetary Authority of Singapore (MAS) released last year. The region also saw a net increase of 7,800 jobs in financial services in 2016 and 2017.
Ravi Menon, head of the MAS, said during the Authority report launch that “the growth momentum has been sustained in the first half of this year and we are looking at another good year for financial services.”
When referring the hiring in the IT industry, he said, “IT has emerged as a key functional area driving hiring demand across financial services. Some of the fastest growing job roles are in software development, cyber security, data analytics, artificial intelligence, as well as business process engineering and fintech alone is estimated to have contributed close to 2,000 of the net jobs created during these two years.”
The Randstad report says among the reasons for fintech companies increasingly attracting candidates from both financial and technology sectors are the high salary and benefits packages offered. “Fintech and other similar startups are also able to offer a more progressive culture that promotes learning and healthy competition – key factors that technology talent look for in an employer,” it states.
Investment-friendly environment, government support, and financial stability are some of the reasons Singapore is becoming a fintech hub. A 2017 PwC global FinTech survey found that more players of Singapore’s finance industry see fintech as a way to gain a competitive advantage over their global peers.
A number of companies in Singapore have raised funds using ICOs (initial coin offering) instead of opting for the more traditional funding routes. This approach will attract more investors into our local technology marketplace, creating more opportunities for new startups, notes the report.
It also states that within fintech, blockchain is a fast-growing area with a number of financial institutions using this new technology in KYC (know-your-customer), documentation and authentication. “We will likely see more new technology companies being powered by blockchain within the financial services space, with the Monetary Authority of Singapore (MAS) pronouncing its support for the development of blockchain solutions,” the report says.