Singapore unveils regulatory guidelines for fintech initiatives, opens door to un-advised online life insurance sales
The Monetary Authority of Singapore today unveiled a set of regulatory guideline it said were aimed at encouraging the use of “experimentations” that would utilise technology to deliver financial products or services, such as the use of blockchain technology for inter-bank payments, and at the same time opened the door to selling “the full suite of life insurance products online without advice”.
These and other initiatives were unveiled during a fintech conference held in the city-state, where they were outlined by MAS managing director Ravi Menon.
In his speech, Menon said that with respect to the online sales of life insurance products, it would be “issuing guidance on the safeguards to be put in place” for this avenue of distribution.
Nevertheless, Life Insurance Association of Singapore executive director Pauline Lim responded to the news of the online selling of life insurance “without advice” by noting that while her asscociation was fully “supportive of initiatives which encourage individuals to… take charge of bridging their underinsurance gap” that exists, this particular sales channel would be most suited to “a more digital-centric, financially savvy, self-directed segment of the community”.
She added: “Importantly, while efforts are focused on leveraging technology to make it more convenient for individuals to seek policies online without professional advice, measures need to be put in place to ensure that their overall well-being is not compromised, such that they end up over-insured in certain areas, and under-insured in others.”
She stressed that LIA Singapore “and our members are fully committed to [ensuring] that individuals are getting the right policies to meet their personal needs”.
On the subject of the use of blockchain technology for interbank payments, Menon told the conference that under the pilot system that is being implemented, banks will deposit cash as collateral with the MAS, in exchange for MAS-issued digital currency. They would then later be able to redeem the digital currency for cash.
This would enable the banks to use the digital currency directly among themselves, which Menon said would strengthen resilience while lowering costs.
As reported, the MAS in August unveiled plans for promoting the use of electronic payments within the jurisdiction, which were contained in a just-published “Payment Roadmap” prepared for it by KPMG, as part of its goal of becoming Asia’s financial technology hub.