MAS fintech officer tells regulators to upgrade to cloud

Physical data centres are no longer “sufficient” to deal with the digital financial world’s data needs, according to the Monetary Authority of Singapore’s chief fintech officer.

Speaking at Central Banking’s inaugural FinTech & RegTech Global Summit, Sopnendu Mohanty said data was growing at an “uncontrollable” rate.

“Physical data centres are no longer sufficient. Central banks must now look to create clear policies around cloud computing,” he said today (September 6) in Singapore. ”It is the only way forward.”

Failing to creating these policies and actively implement cloud storage risks restricting the growth of financial technology and its permeation into the wider digital world, he noted.

According to Mohanty, data is the lifeblood of fintech’s success; restricting access to data, he said, would prevent financial technology from reaching its full potential.

“You cannot build a regtech or suptech architecture if your financial institutions cannot share data through APIs [application programme interfaces],” he told the audience.

An API is a software intermediary that allows two applications to talk to each other, allowing parties to easily share data.

In Singapore, the MAS has mandated all banks under its supervision must submit data to the central bank in a machine-readable format using APIs.

Going forward, this will be the only accepted form of data sharing between the regulated firms and the central bank, Mohanty said.

Art of sharing

During his speech, Mohanty focused in on the “digital enablers” that would allow fintech to succeed in today’s increasingly technology-focused world.

Data and more specifically data residency – how and if data can be shared across international borders – is a key concern for him.

“This is one of the things central banks do not really talk about – it is an undiscussable issue,” he said.

Mohanty went on to question how central banks and regulators could foster a “digital globalised world” if data sharing and data access between partners was restricted.

“Data can and must be shared,” he said. “I am aware there are concerns around security and privacy but it is paramount this sharing takes place in a secure and trusted environment.”