Metaverse and Environment, Society and Governance (ESG) are among the top five innovative businesses in Singapore that believe will have an impact on their business over the next 12 months. These technologies will present opportunities and challenges, including difficulty in accessing relevant ESG data.
About 82% of businesses say the metaverse will have a large or moderate impact on their business in the next year, while 84% believe the impact will be felt after three years, according to a study conducted by the company. Financial services technology company FIS announced.
It polled 160 executives in Singapore from both the financial services sector, including banks and insurance companies, and the non-financial services industries, including retail, tourism and suppliers. technology. The study is part of a global report surveying 2,000 executives in nine countries, including Australia, Germany, Hong Kong, India and the UK.
Among Singaporeans polled, 81% said ESG will affect their business in the next year, while 89% believe the impact will be felt in three years.
Another 81% indicated that embedded finance is a major innovation that will impact their business over the next 12 months, while 76% say the same for decentralized finance (DeFi) and 69% cited electronic money. These numbers rose to 89% for ESG, 84% for embedded finance, 83% for DeFi, and 73% for crypto when respondents were asked about the impact over three years.
Embedded finance includes tailored financial services that are made available to consumers when needed by non-financial service providers, such as payment and investment services.
The study revealed that Singapore executives saw both opportunities and challenges as these five technologies evolved.
For instance, the FIS notes that some respondents have actively researched potential opportunities in the metaverse and believe that being present in cyberspace over the next three years is strategically important. However, there are concerns that content moderation and standards of behavior will be a barrier to adoption.
The FIS notes that this suggests that more control and predictability of the virtual environment is needed for the metaverse to reach its full potential.
And while respondents conceded that DeFi, which harnesses blockchain technology and digital assets to manage financial transactions, offers huge growth opportunities, some argue that user experience is a barrier to adoption.
Also, the lack of clarity around cryptocurrency regulation considered a major barrier to adoption.
As ESG issues are concerned, respondents in Singapore saw an opportunity to improve their market competitiveness, with a number of new ESG products and services developing. However, there have been concerns about difficulty in accessing and relevant ESG data analysis and reporting, in the context of a lack of internal data or external tools and technology to support ESG.
Respondents also noted that the incompatibility between their risk management framework and most digital assets would prevent them from adopting DeFi.
Kanv Pandit, managing director of FIS’s Asia-Pacific banking solutions group, said: “Singaporean businesses have made it clear that increased investment in key areas such as embedded finance, Web3 has been made clear. and ESG are critical to seizing growth opportunities. “This fulfills the government’s ambition to strengthen the city as a cosmopolitan fintech and innovation hub.”
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