In the last few decades, Singapore has cemented its position as a global financial hub. But how? Well, it’s largely thanks to a sound, progressive approach to the world economy. With well-established financial markets of its own, plus a host of banking and capital market services, Singapore has a become a true financial epicentre. It’s also the third-largest market for foreign exchange (forex) on the planet, only recently overtaking Switzerland and Tokyo. That’s a big deal – and all part of why Singapore is a great place for a career in finance.
There are other reasons why Singapore is a smart choice for budding or developing financial professionals, too. Here are just a few.
#1 Popularity of the Singapore Exchange
Although Singapore’s banking system is still important, the diversification of its capital markets has been a major boon. Since 1999, the Singapore Exchange (SGX) has provided an integrated stock and derivatives exchange. And SGX has relaxed its access, with foreign stockbrokers allowed to participate and manage exposure to Asian capital and investments.
The impact on trade here has been significant. As of 2014, some 172.3 million derivatives contracts traded on the SGX, compared with just 25.9 million in 1999. This is all according to a report from the Singapore Management University’s School of Economics.
The liberalised approach to the SGX has also encouraged new trading products and propositions, some of which help to limit risk exposure. Contracts for difference (CFDs) have provided a new opportunity for retail traders to go long or short on a wide variety of financial markets, with trades that mirror the underlying asset. The SGX has sought to create a safer, risk-averse landscape for retail traders to use CFDs as a means of speculating on the rise or fall of assets, without having to physically own them.
One specific example are knock-out trading opportunities for CFDs are new, limited-risk contracts that can expire or “knock out” once the underlying market price of an asset reaches the “knock out” level. This has helped traders to better control their margins and risk on tens of thousands of assets in Asia and other regions, too.
#2 The Fintech revolution
The Monetary Authority Singapore (MAS) warmly embraces the rapid growth of Fintech in Singapore. To that end, MAS, the central bank of Singapore, is fostering an ecosystem that works for the digital age. This means employing smart regulation for Fintech. MAS is encouraging the use of secure cloud storage, as well as application program interfaces (APIs) and platforms. The idea is to improve the assimilation of data and the execution of trades and investments.
Some S$225 million was earmarked between 2015 and 2020. These funds are called the Financial Sector Technology and Innovation Scheme (FSTI). The money is going towards assisting Singaporean financial firms in creating their own innovation labs. The aim? To deliver Fintech services that are ready to go in the next decade and beyond.
#3 Nurturing financial talent
A career in Singaporean financial services can be well-suited to ambitious, progressive professionals who are looking to work their way up the ladder. And MAS is working hard to develop a culture of talent development in the sector. The city boasts a new Financial Sector Tripartite Committee (FSTC). It’s been designed to bring together all government authorities and associations within the financial industry to ensure the workforce is fit for purpose in 2020 and beyond.
Lastly, while Singapore’s financial sector is working to attract overseas talent to the Lion City, it’s also investing heavily in re-skilling the city’s existing finance professionals. For instance, Singapore has implemented initiatives such as SkillsFuture, with a view to further strengthening its position as a global financial centre.
Interested in learning more about working in Singapore? Check this out.
Other interesting reads if you’re thinking of moving to Singapore:
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