UK and Singapore to Cooperate on Sustainable Finance, Fintech Innovationby Fintech News Singapore November 28, 2022
The United Kingdom (UK) and Singapore have signed a Memorandum of Understanding to establish the UK-Singapore Fintech Bridge on Friday.
At the 7th UK-Singapore Financial Dialogue, both countries discussed their joint interests in sustainable finance as well as fintech and innovation.
There are four areas in sustainable finance that the UK and Singapore have agreed to work together on – the first being transition finance.
The UK and Singapore recognised the importance of transition plans and pathways to achieve the Paris Agreement’s goal of limiting global temperature increase to 1.5°C from pre-industrial levels.
As a first step, the two countries agreed to work with partners such as the UK Transition Plan Taskforce and the Singapore-based Glasgow Financial Alliance for Net Zero’s (GFANZ) Asia Pacific office to drive international consistency in design and disclosure of transition plans.
The second area of focus will be the implementation of the International Sustainability Standards Board (ISSB) disclosure standards.
Both countries also commit to phase in mandatory climate-related financial disclosures that provide consistent, comparable and decision-useful information for market participants and financial authorities.
The third area of focus for both countries would be combatting greenwashing, including in relation to sustainability disclosures and sustainable investment product labels.
Both regulators will continue discussing how to adopt a coordinated approach on regulatory oversight of ESG ratings and data products providers, grounded in International Organisation of Securities Commissions’ (IOSCO) recommendations.
Additionally, the UK and Singapore will explore further collaboration opportunities in Project Greenprint.
Lastly, both countries is looking to form a globally consistent framework for nature-based disclosures and exchanged views on how the efforts of the Taskforce on Nature-Related Financial Disclosures (TNFD) can contribute to the ISSB’s global baseline.
They agreed to collaborate to build capacity and understanding of the potential for nature loss and degradation to generate financial risks and cause adverse impacts to business and society.
Fintech and innovation
The bridge seeks to support continued growth, investment, and technological innovation by building on active interest of fintech players in the areas of payments, regtech and wealth management.
Other than that, both countries also shared their latest assessments of market developments, opportunities, trends, and longer-term expectations for the crypto-assets sector.
They also discussed risks and challenges relating to financial stability, regulatory arbitrage, and shared their progress in strengthening rules on consumer protection and developing the regulation of stablecoins.
The Monetary Authority of Singapore (MAS) has been actively seeking to take a more comprehensive approach to crypto regulations to include consumer protection and is targeting to consult on proposed measures in the next few months.
Both countries said that they will continue to actively participate in the shaping of robust global regulatory practices through engagement within international multilateral fora such as the Financial Stability Board (FSB), the Committee on Payments and Market Infrastructures (CPMI) and IOSCO.
E-wallets and digital banking was also a key discussion topic for both countries during the dialogue.
Singapore provided updates on the progress of its review of e-wallet caps and expected next steps. Both countries discussed the recently released consultation, with the UK providing views on the key proposals.
Moreover, Singapore also shared updates on the new digital banks that recently launched their operations in the island state – Trust Bank, Grab-Singtel digital bank consortium GXS, Ant’s ANEXT Bank and Green Link Digital Bank (GLDB).