The Bank of Thailand (BOT) and the Monetary Authority of Singapore (MAS) have entered a FinTech Cooperation Agreement (CA) to further develop and enhance the existing financial ecosystem in the ASEAN region.

The central banks and financial regulators of Thailand and Singapore shook on the FinTech pact during the sidelines of the biennial BOT-MAS meeting hosted by the Singapore central bank this year.

The agreement aims to “develop a richer financial ecosystem” in both countries and South-East Asia, an announcement revealed. As per the agreement, both central banks will also share information on new and emerging market trends in an era of micro-financing and digitization as well as their impact on traditional regulatory practices.

‘In our present era characterized by volatility, complexity and technological innovations, I believe that strengthening cooperation among our institutions will play a key role in fostering regional financial stability and sustainable growth,” stated BOT governor Verrathai Santiprabhob. The central bank official also underlined the potential for greater financial inclusion for the unbanked in the region.

Notably, the FinTech pact will also see both regulators refer FinTech companies from their countries to each other. Joint innovation projects will also be explored, particularly ‘those with potential for cross-border compatibility.’

The two central banks also updated their existing memorandum of understanding (MoU) on Banking Supervision during the biennial meeting. The update to the 11-year old MoU will mandate better information exchange and cooperation in areas including licensing, crisis management and more.

Singapore’s traditional pro-technology agenda has spurred the island nation to become leading global FinTech hub. The mandate is led by the MAS, a central bank that has already tested a blockchain-powered interbank payments platform using its own digital currency. Upon completion of a successful early pilot in March 2017, the central bank revealed details of digitizing the Singapore dollar using an Ethereum blockchain.

Following the new FinTech pact with Thailand, MAS managing director Ravi Menon stated:

The CA and the MOU are complementary, and reflect our joint commitment to capture new opportunities in cross-border financial services while containing their risks.

Featured image from MAS.