This article was written in collaboration with Standard Chartered Bank (Singapore) Limited. All views expressed in this article are the independent opinion of DollarsAndSense.sg. All information provided is for informational purposes only and is not intended to be construed as advice or an offer for any product or service. Standard Chartered and DollarsAndSense.sg is not liable for any informational errors, incompleteness, delays, or for any actions taken in reliance on information contained herein. You can view our full editorial policy here.
As 2020 comes to a close, many of us would still continue to remember this as the year when COVID-19 put a standstill to global travel, forced many office workers to work-from-home and required us to abide by strict social distancing measures such as only being able to gather in small groups.
What may be less remembered is the pivotal role COVID-19 has played to accelerate digital trends in many parts of our lives.
Due to Circuit Breaker in Singapore, and other lockdown measures that have been introduced globally, many of us had to adopt new ways of doing things to continue with our daily lives whether it’s working-from-home, buying groceries, ordering food, attending university lectures or even finding ways to continue with leisure activities.
Going Digital Was Always The Obvious Solution
With deep internet penetration in Singapore, going digital became the obvious solution for many businesses. Video conferencing apps such as Microsoft Teams and Zoom quickly gained tens of millions of users as businesses pressed to continue operations and maintain internal communications.
Businesses also raced to set-up their e-commerce capabilities. At a consumer level, people are actively seeking these e-commerce set-ups to continue their required and discretionary purchases.
To be clear, it’s not that these digital solutions didn’t already exist in the past.
The problem lies in the invisible barrier to change. Often, barriers exist because people are reluctant to change the way they are used to doing things. For example, a company that is used to holding physical meetings may prefer to continue meeting in person as far as possible. A provision store may not prioritise an e-commerce set-up until it’s forced to do so. Even when it comes to banking-related matters, some individuals may not think that they require internet and mobile banking until they face some form of inconvenience.
Because of COVID-19, some of these barriers were simultaneously broken. This was the same for banks and financial institutions, which had to embrace digital solutions to prepare themselves for the next stage of the digital revolution.
Rising Digital Adoption Of Digital Banking
Once everything moved online, and because people also became more conscious of handling physical notes and coins, paying moved to cashless options. This saw large swathes of businesses race to set-up their e-commerce capabilities and to accept in-store digital payment as people also shift a larger share of their payments on digital platforms.
Today, there are many mobile payment apps and services, such as Google Pay, Apple Pay and Samsung Pay that we can link to our credit cards, allowing us not only to pay without cash, but also without even needing to use our physical cards.
Once the economy recovers and health fears have subsided, these trends are not just going to disappear. Instead, they are here to stay.
Hooked On Digital Banking Services
During the Circuit Breaker, and at the height of the COVID-19 fears in Singapore, some banks and other financial services had to close their bank branches for a period of time. Coupled with our preference and the government’s encouragement to avoid social interactions as far as possible, this meant a surge in demand for digital banking and financial services.
Utilising digital solutions generally mean more convenience, being able to perform transactions faster and on-demand, as well as a seamless solution designed specifically for individuals to execute their own transactions.
At the same time, the majority of banks in Singapore have a comprehensive mobile app for consumers to stay up to date with their accounts and to manage their personal finances.
For example, the SC Mobile Singapore app, easily downloadable via Play Store or Apple Store, allows us to make transactions virtually, just like what we can do if we walk in to a physical bank branch.
In addition, via its SC Money Manager tool, the app can give us analytics into our expenditure habits and income – telling us how much we spend each month and on which product categories. It also gives us the option to set a budget for categories such as shopping, dining, transport, entertainment and others, so we get alerts when we spend more than what we’ve initially budgeted to spend. This keeps us accountable to a budget.
Whether it’s through the SC Mobile Singapore or other popular bank apps such as DBS digibank SG, OCBC Bank or UOB Singapore that many of us may also be using, features such as being able to make fund transfers to our friends, bill payments to organisations or to review our e-statements are available via the apps. We may also be able to apply and get approval for a digital credit card instantly, without needing to wait for the card to arrive before making a transaction.
More Competition (And Innovation) From Existing And New Digital Banking Players
COVID-19 or not, Singapore has been poised to introduce up to two digital full bank licences and three digital wholesale bank licenses. In December 2020, the Monetary Authority of Singapore (MAS) announced the awarding of four digital bank licenses to companies. These are banks that would be providing banking services on digital platforms.
Interestingly, none of the four winners – Grab & Singtel; Sea Limited; a consortium comprising Greenland Financial Holdings, Linklogis Hong Kong, and Beijing Co-operative Equity Investment Fund Management and Ant Group – are companies that we would consider as financial institutions. So each of these new players may bring their own unique approach towards digital banking.
As competition heats up, consumers will likely stand to gain from more disruption in the space. This may be in the form of existing and new players introducing more innovative solutions and analytics tools, better service, lower costs and more. In turn, this will only serve to accelerate the greater adoption of digital banking tools.