Singapore bridges Korean fintech to Asean countries

Tech

Published: 13 Oct. 2022, 18:34

Singapore bridges Korean fintech to Asean countries

From second left to right: Kim Gwang-soo, chairman and CEO of the Korea Federation of Banks; Reuben Lim, chief operating officer at Singapore FinTech Association (SFA); and Boonseng Gan, community director at 80RR [YOON SO-YEON]

SINGAPORE — Korean tech companies can quickly expand their presence in the global market by launching in Singapore, a financial hub for Southeast Asian countries, according to Reuben Lim, chief operating officer at Singapore FinTech Association (SFA).

“The clear regulatory framework in Singapore is what makes it special, added with the fact that we are the springboard to Asean countries, despite the small population here,” Lim told the Korea JoongAng Daily during a tour of 80RR, a co-working space for fintech start-ups in Singapore, on Monday.

“The Digital Economy Agreement [DEA], which is like the free trade agreement on digital assets, signed between Korea and Singapore allows for the active digital exchange between the countries. Singapore has been positioning itself as the regional headquarters for all the business transactions in Southeast Asia.”

Since January 2019, SFA has been working closely with the Banks Foundation for Young Entrepreneurs, also known as D.Camp, to help Singaporean start-ups launch in Korea and vice versa.

The 80RR Fintech Hub is part of SFA’s efforts to nurture fintech ventures in Singapore. Cofounded by SFA, Hong Leong Holdings and the Monetary Authority of Singapore (MAS), 80RR aims to be an open co-working space for start-ups, rather than selecting a few companies for a limited number of offices.

Start-ups accelerated by D.Camp can also use the 80RR space.

“For smaller companies, having a physical space is important for them to meet up and network,” said Boonseng Gan, community director at 80RR.

“As opposed to big companies like Korean Air, Samsung or SK, people don’t know the names of these companies, and they have to make themselves known to the rest of the world. Having a physical space facilitates this so-called publicity."

Singapore has been quickly growing as a fintech leader under the top-down system from the government, easier to regulate than larger countries.

For instance, the PayNow service is a nationwide payment system that allows users to manage, transfer and pay directly from accounts of 10 banks and four non-bank institutions using a single app. The project began in 2017 and saw exponential growth during the pandemic. It is managed by the Associations of Banks Singapore (ABS).

But far from always tightening the leash, authorities in Singapore also guarantee a high level of freedom under a Sandbox regulation program similar to that in Korea.

“Clear regulations are vital for business growth,” Lim said. “Imagine business is like a game of sports, and each time sportsmen are engaged in the sports, the rules are unclear or keep changing. Clear and well set out rules allow the players to play within the boundaries and bring out their best performance.”

The coming years may be tough for start-ups as companies tighten their budget and investments due to bleeding macroeconomic conditions, but start-ups need to weather the storm in order to see it through.

“Both [Korea and Singapore] share similar parallel histories and are hungry for expansion, growth,” said Lim. “Korea and Singapore generally practice a laissez-faire market approach, which means, start-up or not, your solution has to be wanted by the market in order to see success.”

BY YOON SO-YEON [yoon.soyeon@joongang.co.kr]