Singapore is leading in Banking-as-a-Service (BaaS), with almost half (47%) of banking professionals having deployed or improved their BaaS capabilities in the last year and a similar proportion (45%) looking to do so in the next 12 months – higher than in any other market surveyed.
According to Finastra, this investment activity is accompanied by some of the highest confidence globally in BaaS, with 87% of those surveyed expecting to see benefits in the coming year.
The research was conducted in March 2021 amongst 785 professionals at banks and financial institutions across Singapore, Hong Kong, the United States, the United Kingdom, France, Germany and the United Arab Emirates.
Finastra’s Financial Services: State of the Nation Survey 2021 also reveals that Open Banking has become important to 97% of Singapore respondents’ businesses, with over half (56%) calling it a “must have”.
Respondents from Singapore said that Open Banking has provided a number of benefits to their organisation, including improving the customer experience (79%), delivering new services (93%) and improving internal systems (57%).
As well as helping to attract new customers (71%), Singapore finance professionals also stated that Open Banking has helped to attract different types of customers (64%).
About nine in every 10 (89%) of those surveyed in Singapore agreed that adoption and integration of technology and innovation should be at the forefront of the financial services sector.
However, a number of key barriers to innovation persist, showing little change compared to Finastra’s 2020 survey, as 56% said management or decision makers are stuck in old ways of thinking (vs 58% in 2020) and 53% said regulations are too tight (vs 56% in 2020).
Also, 44% said there is not enough industry or government support to foster innovation (no change from 2020) and 56% cited the cost of development/expense of R&D (vs 51% in 2020).
In line with the rapid shift towards digital services last year, nine in 10 (87%) of those surveyed said COVID-19 had accelerated the integration of new technology and innovation.
In Singapore, this translated into the largest average increase in digital banking investment of any market (25%) and the highest proportion of respondents globally saying their bank increased overall investment/budgets in response to the pandemic (84%).