In what has been a big year for China’s fast-growing conglomerate, it was recently confirmed that Ant Group, owned by Jack Ma, was granted a Singapore banking license. The license will permit Ant to operate digital retail banking in the city state, catering to small and medium sized enterprises (SMEs) and other non-retail segments.
The licenses were offered by the Monetary Authority of Singapore (MAS) to non-bank players (two for retail banking and three for wholesale banking) in a bid to liberalize the country’s banking sector. Earning the other digital wholesale banking license was a consortium comprising Greenland Financial, Linklogis Hong Kong, and Beijing Co-operative Equity Investment Fund Management. The MAS shared in a statement that “the two selected digital wholesale bank applicants met [our] expectations and were assessed to be demonstrably stronger across the criteria notwithstanding the general high quality of the eligible applicants.” The winning digital wholesale banks are expected to start operating from early 2022.
In a statement shared by Ant, the company said, “We would like to thank the Monetary Authority of Singapore for awarding us a digital wholesale bank licence, and we are grateful for this opportunity to further contribute to accelerating digital financial innovation and inclusion in Singapore and the region.”
This move also signals the company’s aim to expand globally across Southeast Asia, South Asia, Africa, and the Middle East. It is also a win after the company’s shelving of a $39.5 billion stock sale last month due to regulation.
Last year the central bank announced the auction for five licenses drawing 21 applicants for the bidding. By June of this year, 14 applicants had progressed to the next round. Ravi Menon, the Managing Director of MAS also shared that a criteria for winning a license was that the selected institutions would be able to thrive alongside the incumbent’s banks to raise the industry’s bar in delivering quality financial services with a goal to strengthen Singapore’s financial sector for the digital economy of the future. The auction drew attention from local and international companies as Singapore is renowned for high regulatory standards.
Digital full banks will provide a wide range of financial services and take deposits from retail customers, while wholesale ones will focus on serving small and medium-sized enterprises and other non-retail clients. The MAS has indicated that should these first two winners succeed, the city state may issue more digital and wholesale banking licenses.