Podcasts Other Barefoot Innovation Podcast We Have Less Time than We Think: Singapore's Sopnendu Mohanty

We Have Less Time than We Think: Singapore's Sopnendu Mohanty

Published: Aug. 16, 2017, 3:56 p.m.

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I met today\\u2019s guest, Sopnendu Mohanty, about 18 months ago. I moderated a panel on blockchain for last year\\u2019s MIT Fintech Conference, and Sop, who is the Chief Fintech Officer of the Monetary Authority of Singapore, was a panelist -- explaining how MAS was building a regional innovation hub that included blockchain strategies. Since then I\\u2019ve seen him three more times -- once at Harvard, which he visited with the visionary head of MAS, Ravi Menon; once when I spoke at MAS\\u2019s enormous conference last fall in Singapore; and last at a regulator gathering in Jakarta this year, where we recorded this short conversation.

The thing that strikes me most is that, when I first met Sop, he was way ahead of nearly everyone else in thinking about regulating fintech and regtech for regulators -- and that the last time we talked, he had widened that lead even further. On these issues, he might be the most forward-thinking regulator in the world.

The Jakarta meeting was extraordinary. Funded by the Omidyar Network and the Gates Foundation and organized by the amazing Fintech Stage, it drew regulators from six continents, all coming together to share problems and solutions on how to modernize regulation as technology transforms finance. Many were from the developing world, where rapid mobile phone adoption and mobile money services have outstripped traditional regulatory frameworks. Many, though, were from developed countries grappling with how to become innovative, themselves. Notably absent was the United States.

In Jakarta, Sop and I ducked into an empty conference room during a short break and had this talk, as a teaser for a longer episode on his next trip to the U.S.

Singapore is widely regarded as a top world leader in regulatory innovation, right up there with the UK Financial Conduct Authority that started the worldwide movement toward governments adopting innovation agendas. That movement is burgeoning -- recent research by the Aspen Institute finds that more than twenty nations have launched or are exploring regulatory innovation initiatives. MAS was either the second or third one, depending how you count (Australia was early too). MAS has built a \\u201ctech stack\\u201d that includes giving innovators wide latitude to try new things, as well as \\u201cco-creation\\u201d of some regulatory change with industry and a sandbox for experimentation.

I\\u2019ve become convinced that regulators actually need sandboxes and reglabs, because hands-on testing will be the only way they can learn fast enough to keep up with today\\u2019s technology change. Here\\u2019s my recent article making that argument!

In our talk, Sop explains MAS\\u2019s \\xa0\\u201cpragmatic\\u201d approach, which emphasizes small-scale experimentation, partnering with industry to solve specific problems, and learning from industry which, he says, generally knows more than government does.

When you talk with Sop, you feel a palpable sense of urgency. I think that\\u2019s why his thinking is evolving so fast -- he believes we\\u2019re running out of time. He worries that the financial system will suffer a calamitous cyber attack and that we have to move much more aggressively to \\u201cfuture-proof it.\\u201d

Of course, Singapore has an easier challenge than we do in the U.S., since it\\u2019s smaller and has a vastly simpler financial system and regulatory framework (every country has a much simpler regulatory framework than the United States). When I pointed this out to Sop, though, he had a response that has been haunting me ever since. I think you\\u2019ll find it thought-provoking.

I\\u2019ll be speaking again at the MAS Fintech Festival in November and urge you to come. Last year it drew a stunning 13,000 people. This year, he thinks that could double! \\xa0That would surely make it, by far, the world\\u2019s largest financial conference. It will be an exciting place to be.

So, enjoy my conversation with Singapore\\u2019s Sopnendu Mohanty!

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We have great new shows coming up. We\\u2019ll be posting the series I recorded from the floor of the ABA\\u2019s annual Regulatory Compliance Conference, including one with Gene Ludwig and Alistair Renee of IBM\\u2019s Watson Financial on how artificial intelligence will transform compliance. In addition we\\u2019ll have Sanjay Jain, who helped build India\\u2019s revolutionary \\u201ctech stack\\u201d project to capture customer identity on more than a billion people. We\\u2019ll have the exciting startup, Petal, and we have several coming up on anti-money laundering.

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