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Virtual banking: the new frontier for fintech in Singapore
If we were to take both global and local players into consideration, there are no fewer than 400 fintech companies operating in Singapore today — and there are good reasons for this too.
Singapore has one of the most pro-fintech governments around. For example, in 2015, the Monetary Authority of Singapore (MAS) established the FinTech and Innovation Group to “enhance and strengthen competitiveness in the financial sector” and provide grants of up to S$1 million (US$726,568). Also, the government recently moved to allow startups to easily test financial products in a controlled environment. Finally, the Bank for International Settlements recently announced plans to set up an innovation centre in Singapore. These conditions have allowed the fintech ecosystem to truly flourish in the city-state.
However, the latest announcement from MAS is arguably the most exciting one. In June 2019, MAS said that it would begin accepting applications for up to five new licenses for digital banks. This marks Singapore’s official entrance into the world of virtual banking.
Advantages of virtual banking for customers
Virtual banks, or banks that exist purely online without any physical presence, have many advantages for customers. The first being that virtual banks are available 24/7 for all services. Traditional banking or business hours will no longer limit transactions and services that can be accessed. Customers can take much greater control over some banking processes, making transactions online or through an app.
Additionally, without the overhead of physical branches, virtual banks may be able to pass that savings on to customers in the form of things like better interest rates or lower fees. Furthermore, these new virtual banks are backed by reputable companies already established in the region, including the likes of Tencent, Xiaomi, ICBC, Standard Chartered and many others.
Virtual banking and hiring: a competitive market for professionals
The opening of virtual banking is also having a positive effect on the hiring market, as investments begin to pour in from investors.
For candidates, talent with AI, machine learning, data science, UI/UX and digital transformation experience will be in relatively high demand. Furthermore, due to the online nature of virtual banking, traditional Know Your Customer processes will no longer work, which means that virtual banks now have to look for alternative ways to verify bank customers. As such, talent well versed in cybersecurity, too, will be in good demand.
Talent can also expect innovative and attractive salary packages to emerge. Tech professionals with strong background in software programming and security have been able to command as high as 50% increment in their base salaries. Local talent with strong technical software programming skills, in particular, can expect everything from fixed monetary packages and performance-based bonuses to stock options.
However, monetary benefits are just part of the equation. In order to attract millennial tech talent, flexible working hours, personal travel allowances, child care support and work-from-anywhere solutions will also be on the negotiation table.
On the employer’s end, local banks continue to be the top technology hirers in the banking industry. This stands in contrast with foreign banks, which are relatively more conservative on the hiring front, preferring instead to invest in low-cost location strategy for roles that can be worked remotely.
Technology firms are not falling behind on hiring, either. We know for a fact that many of them have engaged advisory firms to map out the structure, talent needs and processes required for virtual banking offerings. This could potentially mean a more targeted approach to hiring, especially candidates from large banks.
PageGroup: Getting into the market quickly
At PageGroup, we have been partnering with clients in this space over the last 12 months as they build their proposition and expansion plans. Similarly, we have been proactively building a community of talent to fulfil a job market need. Working closely with many of the top players in this highly competitive market, we are helping these new companies define hiring needs, refine hiring practices and find suitable talent, delivering them effectively.
As a result of virtual banking, more focus has been placed on retail banking candidates at mid to senior levels looking to transition their skillset into the virtual banking sphere. These candidates have never been as high in demand as now.
Download the Michael Page Singapore Fintech Employment 2019 Guide here.
For more information about hiring within virtual banking or fintech within Singapore, please contact us for a chat.