Both countries discussed collaboration opportunities in priority areas such as sustainable finance and FinTech and innovation, and exchanged views on recent developments in non-bank financial intermediation (NBFI) as well as efforts to improve cross-border payment connectivity.

Sustainable Finance

The UK and Singapore reaffirmed their commitment to scale financing in support of the net zero agenda.

A. Developments in transition planning:

The UK and Singapore reaffirmed that globally comparable and sound transition plans are essential for the scaling of transition finance. The UK updated on the progress of the Transition Plan Taskforce (TPT)’s disclosure framework following its publication in October 2023, and outlined plans for introducing expectations for listed companies’ transition plan disclosures. The Monetary Authority of Singapore (MAS) shared its consultation on Transition Planning Guidelines in 2023, which set out supervisory expectations for financial institutions to have a sound transition planning process, as they build climate resilience and manage risks arising from the global transition to a net zero economy and the expected physical effects of global warming. The UK and Singapore also noted the importance of ongoing work at G20, Financial Stability Board (FSB), Basel Committee’s Task Force on Climate-related Financial Risks (TFCR), International Organization of Securities Commissions (IOSCO) and Network of Central Banks and Supervisors for Greening the Financial System (NGFS) in this respect.

B. Disclosure standards, ESG ratings and data products:

The UK and Singapore re-affirmed their commitment to implement the International Sustainability Standards Board (ISSB)’s standards to improve the consistency, comparability, and reliability of sustainability-related disclosures globally. The UK provided an update on its Sustainability Disclosure Requirements and its associated labelling regime. The UK and Singapore also discussed the voluntary codes of conduct for ESG ratings and data product providers that have been published in their respective countries, noting that both codes were aligned with IOSCO’s recommendations. Both countries agreed to consider collaboration opportunities as the regulatory landscape evolves, including through IOSCO’s Sustainable Finance Taskforce.

C. Sustainable infrastructure and investment:

The UK and Singapore noted the large funding gap for Asia’s green and transition finance, and agreed that there are opportunities to mobilise private capital for the net zero transition. Building on the September 2023 UK-Singapore Strategic Partnership [footnote 1] to accelerate regional sustainable infrastructure and investment, the UK and Singapore will collaborate to develop and finance green finance and energy transition projects in the region. MAS provided an update on Singapore’s blended finance initiative, the Financing Asia’s Transition Partnership (FAST-P)[footnote 2], which will bring together key public, private and philanthropic sector partners to mobilise financing to de-risk and finance transition and marginally bankable green projects in Asia.

FinTech and Innovation

The UK and Singapore exchanged views on their respective approaches to manage risks and capture opportunities in the digital space.

A. Artificial intelligence (AI):

The UK and Singapore discussed financial stability risks, cyber security risks, as well as supervisory considerations associated with the increased use of AI in the financial sector. Both countries agreed that international standards were key to facilitating innovation while managing risks to consumers, financial market stability and integrity, and explored areas for collaboration through international fora, such as IOSCO and FSB.

B. Cryptoassets:

The UK provided an update on its final proposals for creating the UK’s financial services regulatory regime for cryptoassets, under which the government will bring a number of cryptoasset activities, such as exchange, custody, and lending activities, into the regulatory perimeter for the first time. The UK also updated on its plans to regulate certain fiat-referenced stablecoins and create the environment for stablecoin issuers and service providers to operate and grow in the UK.

C. Central Bank Digital Currency (CBDC):

The UK shared developments on progress following the publication of the “digital pound” consultation response paper on 25 January 2024, including a design phase which would be followed by a decision on whether to proceed with a retail CBDC. The UK also shared their thinking on wholesale payments, including on infrastructure supporting the settlement of tokenised transactions.

D. Tokenisation and distributed ledger technology (DLT):

The UK and Singapore shared their respective projects and initiatives in tokenisation and DLT and agreed on the benefits of asset and fund tokenisation to the financial ecosystem, from broadened investor access to investment products to simplifying distribution and trading of such products digitally. As part of Project Guardian’s policymaker group, the UK Financial Conduct Authority (FCA) and MAS, together with the other policymakers aim to advance discussions on the regulatory treatment of digital assets. Both countries agreed to share learnings on how regulatory regimes could facilitate responsible innovation.

Developments in the NBFI Sector and Cross-Border Payment Connectivity

The UK provided an update on recent developments to address risks in the NBFI sector. Both countries underlined the importance of enhancing authorities’ ability to monitor risks in NBFIs via better data gathering and sharing. They also agreed on the importance of finalising on-going international policy work on margining practices and NBFI leverage, and to subsequently implement agreed NBFI policies at domestic level. The UK and Singapore agreed to continue their collaboration to address vulnerabilities associated with NBFIs, including at IOSCO and the FSB.

The UK and Singapore reiterated their commitment to the G20’s Roadmap to Enhancing Cross-Border Payments, including the FSB’s priorities for this year as laid out in its most recent progress report. The BIS Innovation Hub Singapore Centre also shared the progress of Project Nexus[footnote 4], a multilateral approach to connect domestic instant payment systems to improve the speed, cost, transparency and accessibility of cross-border payments.

The UK and Singapore renewed their commitment to engagement beyond the Dialogue through a series of roadmap engagements to explore further cooperation in sustainable finance and FinTech and innovation, ahead of the next Financial Dialogue due to be held in the UK in 2025.

Two industry-led UK-Singapore business roundtables on Transition Planning and Generative AI will take place on 9 May 2024 with participation by industry participants from both countries.

The Transition Planning roundtable will examine current regulatory initiatives and next steps for Financial Institutions and their portfolio companies in their transition to net zero.

The Generative AI roundtable will discuss the challenges this technology poses for regulatory compliance and identify strategies to harness the benefits of generative AI while fostering innovation and protecting consumers.

The Dialogue was jointly chaired by Deputy Managing Director (Markets and Development) of MAS, Mr Leong Sing Chiong, and Director General (Financial Services) of HM Treasury (HMT), Ms Gwyneth Nurse. The Dialogue was attended by senior officials from MAS, HMT, Bank of England, FCA, the High Commission of the Republic of Singapore in London, and the British High Commission in Singapore.