On July 18, MAS announced that it will invest SGD 100 million in AI and quantum computing, among other initiatives
Technology development will occur through collaboration with industry leaders, academia, and technology enterprises.
Such initiatives will attract and develop AI and quantum –computing experts.
This major investment is part of the Financial Sector Technology and Innovation Grand Scheme 3.0, which started in 2022 with an initial fund size of SGD 150 million. The new funding will make Singapore a global leader in fintech by building expertise in cutting-edge quantum computing and AI technologies.
The Monetary Authority of Singapore (MAS) is introducing key initiatives under the FSTI 3.0 scheme:
1. Quantum computing: MAS is developing a quantum track under FSTI 3.0. This includes the technology centres grant and the technology innovation grant to help financial institutions build quantum computing capabilities with a focus on innovation in areas such as security and infrastructure development. Quantum computing is going to revolutionise financial modelling, risk management, and investment strategies by processing vast amounts of data at an unprecedented speed.
2. Artificial intelligence: MAS is working on enhancing its AI and data grant scheme to support industry-wide adoption of AI in Singapore. This comes with the establishment of AI innovation centres involved in proving high-impact AI use cases, AI innovation governance, risk management, and model development. This is intended to develop AI platforms by MAS in order to help address industry-wide problems, which include scam and fraud through secure data exchange amongst financial institutions.
3. Talent development: As far as the reinforcement of quantum and AI capabilities in the financial sector in Singapore is concerned, the genuine game-changer will be its close link with its academic institutions and the Institute of Banking and Finance. The design aims to draw in top talent in these fields and equip the workforce to effectively tackle future challenges.
Impact on the financial sector
Within Singapore's banking sector, the convergence of AI and quantum computing is likely to drive immense value. Quantum computing can supercharge investment strategies, reduce risks, and take financial modelling to a new level of crunching terabytes of data in nanoseconds. On the other side, AI will be able to afford advanced data analysis, give insights that empower trend prediction, and automate routine tasks for smarter decisions and more streamlined operations.
MAS's ambitious project could place Singapore firmly on the world map as a leader in fintech. The country seeks to create a vibrant financial ecosystem that is future-ready, and by accelerating innovation and cross-sector collaboration, it can support economic growth.
The strategy itself is very complex, but it presents many promising opportunities. Integrating AI and quantum computing into existing banking systems requires careful consideration of security and privacy. Additionally, there are legal concerns about maintaining the confidentiality of financial data and establishing trust in the ethical and responsible use of these technologies.
Singapore's financial industry received a significant boost with a SGD 100 million investment in AI and quantum computing by MAS. This clearly emphasises Singapore's leading position in the global finance sector while opening new possibilities for innovation. These cutting-edge technologies will revolutionise the financial industry by introducing both opportunities and challenges.