Lecture 1 - Overview of Personal Banking in Singapore

Question 1

Name 4 reasons why it is attractive for foreign banks to set up in Singapore

Answer 1

1. Population size is targeted to grow to 6.9 million by 2030
2. High home ownership rate of 90.8%
3. Low unemployment rate of 2.1%
4. Government’s open policy of encouraging foreign talent

Question 2

How can foreign banks demonstrate their commitment to Singapore?

Answer 2

• Employing local workforce
• Serve mass market by investing in infrastructure for Personal Banking business
• Being around for long-term
• Educating the future generation of finance professionals

Question 3

What can banks do to maintain their competitive advantage?

Answer 3

• Satisfy the changing needs of customers
• Products’ continuing relevance towards customers
• Sales efforts to target both new & existing customers
• Cross-sell personal banking products

Question 4

What are the 3 trends in personal banking?

Answer 4

1. Free Trade Agreement
   
   • It leads to more liberalisation & more foreign bank
     licences issued.
2. Ageing Affluent
   
   • More wealthy retirees with money to spend & invest
3. Private Banking
   
   • banking products and services catered for the
     wealthy individuals & their family

Question 5

What is Platformification?

Answer 5

• A new type of “plug-and-play” business model
• Rather than having consumers having to interact individually with a host of financial services providers
• It will help to synthesis this into one relationship, by allowing multiple participants to connect on the platform in order to create and exchange value

Question 6

3 types of FinTech in personal banking

Answer 6

• Lending: kickstarter, crowd sourcing
• Investment: Auto wealth, algotrading
• Mobile wallets: paylah, grabpay

Question 7

What has the government done to promote FinTech?

Answer 7

• MAS provides grants up to $200K for FinTech trials
• Regulatory sandbox for FIs and startups to test their technologies using real data in a production environment
• The regulator provides explicit guidance on what type of technologies banks are able to use. This provides confidence for the banks to invest in those technologies.