SINGAPORE: Despite a better performance compared to other sectors in a sluggish economy, the financial services sector in Singapore has set itself a new and ambitious benchmark - achieving better productivity, a higher growth than the overall economy and creating thousands of jobs each year up to 2020.
Board member of the Monetary Authority of Singapore (MAS), Ong Ye Kung announced this as he launched the Industry Transformation Map (ITM) for the sector on Monday (Oct 30).
Mr Ong, who is also Minister for Education (Higher Education and Skills) said the ITM is expected to achieve a 4.3 per cent industry GDP growth each year over the medium term. This is “nearly twice” as fast as the overall economy, he said.
He said more than half, or 2.4 per cent of the growth will be driven by productivity.
“The game has changed," Mr Ong said. "This ITM paints our vision for Singapore's financial centre and our action plan to achieve it."
Mr Ong said the ITM will aim to create 3,000 jobs in the financial services sector such as in banks and fund management companies in the next three years. An additional 1,000 jobs in the financial technology (FinTech) sector will be created each year up to 2020.
But even as the sector grows, Mr Ong urged financial institutions and other stakeholders to ensure workers stay relevant amidst a wave of technological disruptions to the industry.
The ITM is the 12th one launched as part of the Government's S$4.5 billion plan to transform Singapore's economy.
It outlines growth strategies for the sector, which includes supporting Asia’s development, introducing programmes to upgrade skills and leveraging technological advancements within the sector.
MAS said a key focus of the ITM will be to ensure technological adoption becomes pervasive across the financial services sector.
It said it would step up efforts to encourage financial institutions to enhance connectivity and collaborate with them to create common utilities such as electronic payments and digital ID.
MAINTAINING SINGAPORE CORE
MAS said the financial services sector’s tailored road map would provide for an active SkillsFuture programme to help workers build “world-class skills” and maintain a strong Singapore core.
“With digitalisation and automation, job roles will evolve, and existing professionals must be equipped with new skills and competencies,” it said.
"How do we address the challenge of talent and skills? The answer cannot be poaching ... we simply have to expand and deepen the talent pool," he said.
To this end, stakeholders such as financial institutions, tripartite partners and institutes of higher learning are collaborating to build a pipeline of specialised talent in areas like IT for new entrants and mid-career job seekers.
NTUC's Assistant Secretary-General, Patrick Tay said the labour movement is also working with MAS and financial institutions to strengthen human resource practices through an industry code on hiring and deployment.
Mr Tay, who is also Member of Parliament for West Coast GRC said he had brought up the issue of 'triple weak' companies in Parliament recently - those that do not meet the minimum criteria in terms of having and maintaining a Singaporean core in their staff make-up.
Mr Tay added: "When we work with the respective financial institutions, things are getting better and improving and I can see a conscious effort by employers and also by MAS, powering this drive towards a Singaporean core."
RESKILLING AND TRAINING AMIDST TECHNOLOGICAL DISRUPTIONS
MAS will also be working with the sector to help professionals reskill and move into new jobs through professional conversion programmes.
“When an existing activity is disrupted and jobs become at risk, the tendency is to lay off staff,” Mr Ong said.
“But this cannot be the solution of first resort. For professionals who have honed their craft over many years, a large part of what they already know can be reapplied within the financial services sector or in adjacent sectors.”
In the consumer banking sector for example, some firms are already seeing and adapting to changes.
"There will be some roles that will be significantly changed for example with our front-line staff," said OCBC's Group CEO, Samuel Tsien.
"Our front-line staff used to deal more with more mechanical responses to the customers’ enquiries. Now we really have to go deeper into understanding what customers’ needs are and fulfil those needs."
When asked if the disruptions will result in workers being made redundant, Mr Tsien said: "It will be an evolving phase - as we see roles becoming more diminished, we will always provide additional skills to them so they can be trained to move on to a new role."
“We have to get this right, or else fail in our quest to push for continuous innovation,” he said.
A WEALTH HUB
Against a backdrop of greater competition in wealth management from economies like Hong Kong and Switzerland, MAS said it is working with the industry to develop Singapore into a “centre of excellence for wealth management technology and innovation”.
In a media release, it said the ITM will also deepen the wealth management talent pool, to provide “comprehensive, high-quality wealth advisory solutions”.
And rather than going offshore to places like Cayman Islands, the idea is to attract big players to Singapore instead. MAS said it is leveraging its external fund management programme to “anchor deeper asset management capabilities in Singapore”.
“MAS is also working with the industry to position Singapore as a regional fund domiciliation hub through the Singapore Variable Capital Company framework,” it said in its release.
Mr Ong said authorities are working with industry players to establish private market funding platforms to enable Asian growth companies gain access to a wider network of investors.
This comes amidst a global trend of more companies choosing to stay private than getting listed on the stock exchange.