What are the Fintech Companies?
Singapore’s environment sets a friendly business operation area that encourages innovation. The country is famous for housing many powerful financial institutions since it is among the top finance hub centers globally. Over the last couple of years, experts have come up with ways to use technology to improve the financial sector resulting in Fintech companies. Just like the name suggests, Fintech is a blend of two terms, finance, and technology. It is a broad category that includes firms that offer new technology that improves the financial sector. For instance, a company that comes up with a digital payment system is a Fintech company.
Fintech Companies in Singapore
Are you thinking of migrating or kicking off a Fintech company in Singapore, and you don’t know where to start? If that the case, you are in the right place. Singapore laws state that a Fintech startup company must match Singapore’s company requirements and the financial services regulatory framework.
The Finance ministry requires a Fintech company to register under the ACRA (Accounting and Corporate Regulatory Authority), which includes corporation or individual that performs business operations for foreign investors. Foreigners and locals can use the most famous structure, Private Limited since it has fast and straightforward requirements. Some of these requirements include one shareholder, a Singapore-based director, Singapore’s address, and at least S$1 share capital.
There are no specific licenses that match with Fintech Companies, but as mentioned earlier, they must comply with the Singapore Company regulatory framework. As a result, startups must have the proper licenses to match the business model. Fintech companies may require various permits depending on the services they offer.
Personal data act Compliance
Singapore Personal Data Act determines the use, obtaining, and disclosure of organizations’ personal data. Like financial services firms, Fintech companies must collect personal data to verify their customers’ identities. All Fintech companies in Singapore must comply with the Personal data act. It states that they must comply with various obligations, including:
- Consent and purpose where they notify their customers of the intent of the data and receive permission to use it
- Give customers access to data
- Verify the accuracy of the data
- Take necessary security measures to promote customers’ data
- Personal data transfer limitation
- Fintech companies must implement policies that meet all the obligations
Counter financial terrorism and comply with anti-money laundering policies
Singapore has a record of continued money laundering and financial terrorism threats, and the country has set up procedures to counter these threats. It has established guidelines that financial services must follow, including Fintech Companies. As a result, Fintech companies must put in place robust control systems to detect any financial threat.
The Monetary Authority of Singapore has developed the Fintech sandbox, which aims to provide these firms a chance to experiment with new products for a period. It is not fit for all firms since companies that specialize in other services can’t access it.
Singapore’s government is encouraging people to venture into Fintech companies and improve their services in the finance sector. Although MAS is yet to set specific legislation, Fintech Companies still need to follow the Financial Regulatory framework to ensure safe operations.