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MAS selects 14 digital bank applicants for the next stage of assessment

By Edil Corneille

June 18, 2020

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MAS, Monetary Authority of Singapore, central bankThe Monetary Authority of Singapore (MAS) has selected 14 of the 21 digital bank applications where the applicants will have to later present their proposals via virtual meetings, as per the announcement made today by the central bank.

Earlier in April, MAS, the central bank of the country, had deferred the assessment period for giving out digital banking licenses because of the novel COVID-19 pandemic.

At the beginning of this month, it was revealed by a Reuters report that MAS would be interviewing applicants of the Singapore digital bank licences; where sources of the international news organisation told it that the bidders of the licences will have to take into account COVID-19’s impact on their funding and profitability plans.

The 14 applications have met the eligibility criteria required for the application to be considered. These eligible applicants, comprising five digital full bank (DFB) applicants and nine digital wholesale bank (DWB) applicants will progress to the next stage of assessment.

In January 2020, MAS updated that it had received 21 digital bank applications comprising seven DFB applications and 14 DWB applications. MAS has reviewed all the applications received against the eligibility criteria announced on August 29, 2019.

In the next stage of assessment, applicants will be shortlisted based on their value proposition and business model, incorporating the innovative use of technology; ability to manage a prudent and sustainable digital banking business; as well as growth prospects and other contributions to Singapore’s financial centre.

As the COVID-19 pandemic has significantly impacted macroeconomic and business conditions since the applications were received at the end of 2019, the central bank of Singapore has asked all eligible applicants to review the business plans and assumptions underpinning their financial projections, including sources of funding, and provide an independent review of these assumptions.

MAS does not expect the request for updated business plans and financial projections to affect the timeline for the award of the digital bank licences by the end of this year.

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