Distributed ledger technology (DLT) has the potential to promote financial inclusion in South East Asian countries, Singapore’s Finance Minister said recently.
Speaking at the 22nd ASEAN Finance Ministers' Meeting, Heng Swee Keat outlined the key focus areas which include sustaining growth, boosting resilience, and fostering innovation.
With regard to fostering innovation, the minister said that they will support digital innovations such as financial technology (FinTech). He said:
“The underlying Distributed Ledger Technology presents us with many opportunities for cheap and secure transactions. This can promote financial inclusion for underserved and underbanked segments in ASEAN.”
The Monetary Authority of Singapore (MAS) has been actively involved in the blockchain space. In October 2017, a consortium led by the MAS and the Association of Banks in Singapore (ABS) developed software prototypes of three different models for decentralised inter-bank payment and settlements with liquidity savings mechanisms. This marked the Phase 2 of Project Ubin, a collaborative initiative to explore the use of distributed ledger technology (DLT) for clearing and settlement of payments and securities.
The MAS is also collaborating with other central banks on blockchain initiatives. In November 2017, it joined forces with the Hong Kong Monetary Authority (HKMA) to develop a cross-border DLT platform for trade finance. It is also collaborating with the Bank of Canada on cross-border payments using blockchain technology.
Previously, it had successfully completed a proof-of-concept (PoC) project using blockchain technology in order to carry out domestic inter-bank payments conducted in collaboration with R3.
