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The Monetary Authority of Singapore (MAS): an overview
The Monetary Authority of Singapore is both the central bank and the primary financial regulatory authority in Singapore.
With over $270 billion in reserves, it is one of the largest financial institutions in the world. The Monetary Authority of Singapore (MAS) performs several key functions, including issuing currency, monetary policy and supervision of financial services for more than 5 million Singapore citizens. It’s a state-owned financial institution and it has the full backing of the Singapore government.
A brief history of MAS
In the second half of the 20th century, Singapore experienced significant economic growth. With the country’s GDP experiencing double-digit growth annually, the government had several federal agencies performing monetary functions. In 1970, the Singapore Parliament passed the Monetary Authority of Singapore Act, which established MAS as we know it.
The Monetary Authority of Singapore was consequently established on January 1, 1971. MAS consolidated all of the previous government agencies and became the central authority for all monetary policy and financial regulations in Singapore. It has direct ability to make and implement legislation, in addition to overseeing several industries. Since being established, MAS has played a crucial role in the development of Singapore, which now stands as one of the world’s most successful economies. Their innovative policies foster innovation and outside investment into Singapore. It is a regulator best known for its work encouraging innovation (especially around FinTech) and establishing ESG principles early on.
Key provisions of the Monetary Authority of Singapore
Monetary policy: As the central bank of Singapore, MAS conducts all monetary policy for the country. MAS supervises currency circulation, creates monetary policies and more. These are key functions that the Authority performs to control the money supply and promote economic growth.
Financial services regulation: The Monetary Authority of Singapore also conducts regulatory work for businesses in the financial services in Singapore. MAS ensures financial services companies are conducting their business in a fair and prudent way, not abusing the funds of Singapore citizens or collecting illegal financial data on consumers.
Establish Singapore as a financial global hub: In addition to performing public duties like regulating businesses and issuing currency, MAS is the sole government body tasked with establishing Singapore as a financial hub. MAS attracts foreign investment into Singapore with FinTech and business-friendly incentives for global companies.
Who must comply with the Monetary Authority of Singapore?
Businesses and individuals in Singapore: MAS is the central bank of Singapore. It has similar powers to the U.S. Federal System in addition to regulating the financial services in Singapore. As one of the biggest public institutions in Singapore, it is responsible for stabilising the nation’s currency, keeping unemployment low and preventing inflation. MAS crafts guidelines for Singapore citizens and businesses to follow to achieve those goals.
Financial services companies: Although all businesses have to comply with MAS, there are specific compliance requirements for financial services companies. Some of the specific types of financial services companies that must comply with MAS include:
- Banks (merchant banks, digital banks, etc)
- Cryptocurrency companies
- Private equity firms