28 May 2021
On 30 April 2021, the Monetary Authority of Singapore (“MAS”) announced the launch of a new regulatory technology (“RegTech”) grant scheme and an enhancement of the Digital Acceleration Grant (“DAG”) scheme to accelerate technology adoption in the financial sector.
MAS will commit S$42 million for the RegTech grant scheme and enhanced DAG scheme. These schemes are discussed further below.
Available to Singapore-based financial institutions (“FIs”), the RegTech grant scheme aims to promote the adoption and integration of technology solutions in the risk management and compliance functions of FIs, in order to aid FIs enhance processes and capabilities in these domains, and encourage a vibrant RegTech ecosystem in Singapore.
The grant scheme will cover two tracks that can be used to support either in-house development or commercial partnerships with RegTech firms based in Singapore. The tracks are set out below:
- Pilot track: FIs can seek funding to pilot potential RegTech solutions before embarking on full-scale integration of the product into its operating environment. Funding for this track will be capped at S$75,000.
- Production level project track: FIs can seek funding to develop larger scale customised projects that can be fully integrated into the FI’s systems. Funding for such projects will be capped at S$300,000.
Launched in April 2020, smaller FIs and FinTech firms can avail themselves of the DAG to adopt digital solutions to better cope with the impact of Covid-19, and to position themselves for subsequent recovery and growth.
As of 31 March 2021, MAS has received over 1,100 applications for the DAG from both FIs and FinTech firms. Given the strong response received, MAS will now commit an additional S$30 million to the DAG till 31 December 2021 to encourage the industry to adopt digital solutions that enhance productivity, cyber security, and operational efficiency. This brings the total grants available under the DAG scheme to S$65 million.
The Enhanced DAG provides as follows:
- Ex-post applications: To be eligible for the grant, applicants will need to fulfil a minimum six months prior usage of the digital solution.
- Publishing pre-approved solutions list: Applicants can refer to the General Solutions list to ascertain if a solution can be funded under this grant. Applicants can still obtain an in-principle approval for solutions not found in the list.
- Cessation of support for certain solutions: Given the transition from work from home arrangements to working in the office, funding will no longer be available for all hardware, equipment that support alternative work arrangements and basic digital solutions such as email services and office productivity tools. Examples can be found on the DAG website.
- Extension of DAG eligibility: Aside from MAS-licensed FIs and FinTech firms with less than 200 employees, life insurance and general insurance agencies with less than 200 representatives and employees will also be eligible for DAG support. Life insurance and general insurance agencies will be able to submit claims for expenses incurred after 1 April 2021.
The following materials are available from the MAS website www.mas.gov.sg:
- MAS press release: MAS commits S$42 million to spur adoption of technology solutions for risk management and regulatory compliance
- Annex A - Key changes to Digital Acceleration Grant Institution Project track
Allen & Gledhill Regulatory & Compliance
To assist our clients with compliance matters, our consultancy arm, Allen & Gledhill Regulatory & Compliance, provides a range of services and solutions. Should you have any queries relating to compliance issues arising out of these developments, please contact: