Seize-Singtel and Ant Group win licenses for digital banks in Singapore

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Singapore granted four companies on Friday, including the Ant Group and grab the licenses to operate digital banks in the Southeast Asian country, which would allow tech giants to expand their range of financial services.

The country's central bank, the Monetary Authority of Singapore (MAS), said it used a "rigorous, performance-based process" to select a strong group of digital banks. As these digital banks begin their pilot operations, MAS will look to see if more companies could obtain this license.

A total of 21 companies, including TikTok parent company ByteDance, had applied for a digital license, 14 of which met the admission criteria, according to MAS. Big giants see a great opportunity in the expansion to financial services as a way to increase their revenue in the fast growing region.

MAS assumes that the new digital banks will start trading in early 2022. The other two licenses went to a company wholly owned by Internet giant Sea and a consortium of Greenland Financial Holdings, Linklogis Hong Kong and Beijing Cooperative Equity Investment Fund Management.

Grab-Singtel like traditional banks and Sea will be able to offer bank accounts, debit and credit cards, and other services to its customers. Digital wholesale banks – Ant-Owned Entity and Greenland Financial Consortium – will serve small and medium-sized businesses. None of them need to be physically present.

MAS assumes that the new digital banks will start trading in early 2022. The other two licenses went to a company wholly owned by Sea and a consortium that includes Greenland Financial Holdings, Linklogis Hong Kong and Beijing Cooperative Equity Investment Fund Management.

"We expect them to thrive alongside established banks and raise the industry bar for delivering quality financial services, especially to currently underserved businesses and individuals," said MAS managing director Ravi Menon in a statement. A handful of countries, including the UK, India and Hong Kong, have tightened their regulations in recent years to allow tech companies to act as digital banks.

The ride-hail company Grab and the telecommunications operator Singtel founded a consortium last year to apply for the full digital banking license. Their combined experience and expertise "will further our goal of empowering more people to take better control of their money and achieve better economic results for themselves, their businesses and families," said Anthony Tan, Group CEO and Co-Founder of Grab, in a statement Friday.

In a statement, Ant Group said, "Over the years, Ant Group has extensive experience and proven track record, particularly in China where we work with partner financial institutions to meet the needs of SMEs," Ant said in a statement. "We look forward to working closer and closer with all participants in the financial services industry in Singapore."