SINGAPORE: The Bank for International Settlements (BIS), described as the bank for central banks, announced on Sunday (Jun 30) it was establishing an innovation hub in Singapore.
The move "reflects Singapore's position as a leading international fintech centre", said the Monetary Authority of Singapore (MAS), adding that the hub centre will commence operations "as soon as the institutional arrangements for its establishment have been finalised".
According to BIS, the role of the hub is to identify and develop in-depth insights into critical trends in technology affecting central banking, develop public goods in the technology space geared towards improving the function of the global financial system, and serve as a focal point for a network of central bank experts on innovation.
The Singapore centre will be the third one established, following hubs in Basel and Hong Kong, BIS added. Additional hubs across the Americas and Europe will be added as part of a second phase of implementation.
"The IT revolution knows no borders and therefore has repercussions in multiple locations simultaneously," said chairman of the BIS board of directors Jens Weidmann.
"The establishment of the BIS Innovation Hub will enable central banks to extend their existing collaboration with a view to identifying relevant trends in technology, supporting these developments where this is consistent with their mandate, and keeping abreast of regulatory requirements with the objective of safeguarding financial stability.
"There are significant economies of scale in such an endeavour, and the BIS is the ideal vehicle to realise them," he added.
Said chair of the Economic Consultative Committee Mark Carney: “There is a new economy emerging driven by changes in technology, demographics and the environment.
"While the private sector is driving these innovations, their efforts will be more effective if the hard and soft infrastructure of the global financial system support this innovation, promote resilience and level the playing field on which to compete."
"Central banks have a major role to play," he added. "The BIS Innovation Hub will foster collaboration between central banks and, by extension, help the private sector to fully realise these major opportunities."
MAS managing director Ravi Menon said the authority looks forward to working closely with the BIS and the global central banking community" to advance the "visionary and important agenda" of harnessing the benefits of technological innovations while ensuring the resilience of the financial sector.