Singapore’s fintech sector is calling for fairer access to banking APIs, after a new report by Fintech Nation, a non-profit industry body promoting collaboration across the fintech ecosystem, found that 85 per cent of SME-focused fintechs face limited or delayed API access from banks.
The findings reignite concerns around uneven playing fields and highlight the need for greater regulatory coordination, standardisation as well as sandbox testing to support innovation and inclusion in SME banking.
The report, Singapore SME Banking: Democratising API Access, follows consultations with a range of digital banks, fintechs and ecosystem participants and suggests that SME-focused fintechs remain at a disadvantage when trying to integrate with incumbent banks.
Many participants also said opaque decision-making and inconsistent API protocols had hampered their ability to build competitive services for small business customers. The report comes as Singapore celebrates its 60th year of independence.
Report insights
Key recommendations include the development of a centralised directory of API access points across major banks, more uniform onboarding requirements and the creation of collaborative sandboxes that would enable fintechs to test integrations in a risk-controlled environment.
The report also urges regulators to strengthen API-related guidelines to reduce subjectivity in how banks engage with third-party fintechs and to promote a more inclusive digital finance ecosystem.
While Singapore has made significant strides in promoting financial innovation over the past decade, Fintech Nation said there is still ‘room for improvement’ in fostering openness between incumbents and newer players in the SME space.
In the foreword, Fintech Nation Think Tank co-founders Varun Mittal and Tawishi Singh, write: “Much like a restaurant menu, a well-defined API clearly outlines the available data to different apps, ensuring everyone gets what they need to deliver innovative services. The benefits of a level playing field extend far beyond just fostering competition.
“It encourages specialisation and collaboration, allowing companies to focus on their core competencies and integrate seamlessly with other providers. This creates a more interconnected and efficient ecosystem, ultimately benefiting consumers with more choices and better experiences.”
Fintech Nation said it will continue working with ecosystem stakeholders to drive forward practical reforms and help shape a more connected, competitive SME banking environment.
Source: https://thefintechtimes.com/
