Speech at The Singapore Fintech Awards Night on 10 February 2021 at 80RR By Minister Grace Fu, Minister For Sustainability And The Environment
Mr Chia Hock Lai, President, Singapore Fintech Association,
Ladies and Gentlemen,
1 Good evening. It is my pleasure to join you here tonight.
Growth and contributions of fintech industry
2 More than 40 per cent of Southeast-Asian fintech companies are based in Singapore today. The Singapore Fintech Association, which was established in 2016, now boasts over 850 members. This phenomenal growth is testament to the vibrant potential of the industry.
3 Over the past year, as we all learnt to live with COVID-19, many businesses had to change their way of operating by incorporating new technologies into their workplace. Many of our daily tasks had to be done remotely, and as a result, adoption of digital payments has been greatly accelerated. From shopping online, to telemedicine, to ordering your favourite hawker food, through the adoption of SGQR, fintech has been at the forefront in the fight against COVID-19.
Singapore Green Plan 2030
4 Fintech can play an important role in our pursuit of sustainable development too. Earlier today, the Government launched the Singapore Green Plan 2030, to spark a national movement on sustainability. The Green Plan sets out our pathway towards our climate action goal of halving our CO2 emission by 2050, with targets and game plans for 5 sectors over the next decades. Despite our constraints as a small city-state, we will continue to challenge ourselves to innovate and pilot technological and policy solutions to pursue sustainable development. We will engage widely to co-create solutions which balance the needs of Singaporeans; We will work together with Singaporeans and our partners from the 3P (People, Private and Public) sectors to rally collective actions to realise our goals.
5 The Green Plan has five key pillars: City in Nature; Sustainable Living; Energy Reset; Green Economy; Resilient Future. Under the Green Economy pillar, we aim to transform our industries and harness sustainability as a competitive advantage, and create new and diverse jobs and business opportunities in sectors such as green finance, sustainability consultancy, verification, credits trading and risk management.
6 As an example, carbon trading and services is a potential growth area for Singapore. Efforts to mitigate carbon emissions will increase the demand for engineering, legal and consultancy services related to carbon. The Alliance for Action on Sustainability, set up under the Emerging Stronger Taskforce, is market testing some concepts and business opportunities. One of the ideas proposed is to develop a marketplace and exchange for high quality carbon credits.
7 Businesses play an important role in Singapore's sustainability journey. Hence, we will introduce an Enterprise Sustainability Programme to help enterprises, especially SMEs, to grow their capabilities to adopt sustainable practices, solutions and standards, enhance their resource efficiency and capture new business opportunities in sustainability. More details will be announced soon.
Finance a key enabler for greening economies
8 Finance is a key enabler for greening economies. It is estimated that US$200 billion per year in green investment will be needed in ASEAN until 2030. As a key financing centre for the region, Singapore is playing an active role in supporting such flows. We are currently ASEAN's largest green finance market, accounting for close to 50 per cent of cumulative green bond and loan issuances. Our vision is for Singapore to be a leading centre for Green Finance in Asia and globally.
9 The Monetary Authority of Singapore (MAS) has been working on enhancing the role finance plays in promoting sustainability, through its Green Finance Action Plan. Under this Action Plan, MAS has put in place Environmental Risk Management Guidelines across the banking, insurance, and asset management sectors, to strengthen the sector's resilience towards environmental risk. It has developed grant schemes to support the issuance of sustainability-linked loans and bonds for such instruments. These initiatives help corporates of all sizes, including SMEs, access financing, as they invest in green projects and move towards more sustainable business practices. MAS has also launched the Singapore Green Finance Centre to grow research and talent development expertise.
Harnessing technology and innovation
10 Technology can play an instrumental role in greening finance, and supporting the development of trusted, efficient green finance markets. For instance, good, strong data, and the use of fintech, including artificial intelligence (AI) and machine learning, to process, collect and analyse data, can inform decision making, and risk management practices.
11 In recognition of the potential of fintech to accelerate green finance, MAS is actively harnessing technology and innovation. It launched the Global Fintech Innovation Challenge, comprising the Global FinTech Hackcelerator and FinTech Awards, to identify promising fintech solutions, and catalyse partnerships with financial institutions, to enable better responses to climate change and sustainable development. The Challenge received over 600 proposed solutions from 55 countries. Two of the three winners for the Global FinTech Hackcelerator were green fintech solutions which apply AI technology to analyse climate risk, and improve transparency and comparability across ESG ratings.
12 MAS has also embarked on Project Greenprint, to promote a green financial ecosystem through Green FinTech. It is an umbrella of Green FinTech solutions and projects focused on three key pillars: i) to mobilise capital; ii) to monitor commitment; and iii) to measure impact. Businesses can tap on such solutions to access capital to support more sustainable business practices, and to measure and convey to their financiers, supply chains and clients, their sustainability performance and resulting impact. As a testament to its commitment and focus in this area, MAS has earmarked S$50 million to support Green FinTech projects in Singapore. I urge the fintech community in Singapore to partner these initiatives, tap on the support available, and work with the broader economy to support green growth and development.
13 Let me conclude. I am encouraged by our efforts to incorporate sustainability and resilience into our financial systems today. Propelled by the Singapore Green Plan and bolstered by the collective efforts of the Government and businesses, the future is even more exciting. Singapore is well poised to not just excel in fintech, but to do so sustainably, and to enable more sustainable global development.
14 I would like to thank the Singapore Fintech Association for organising this event. I commend the association for setting up a new sustainability sub-committee, and look forward to working closely with it in future.
15 My heartiest congratulations also to the winners of tonight's Fintech Awards. May your achievements bring positive change to the society and inspire others to join us on this journey towards sustainability.