FIRST arising from scams, after OCBC fully shouldered customer losses. In particular, the financial regulator described OCBC’s goodwill payouts as “a one-off gesture” and said that it does not set a general precedent for future cases. The proportion of losses that each party bears will depend on whether and how the party has fallen short of its responsibilities, MAS wrote in its announcement. A new framework, created by The Payments Council, is also set to be released for public consultation in the next three months. Other than the sharing of losses, the consultation will also cover the responsibilities of other key parties in the ecosystem.
FIS KEY FOR GREEN ENERGY INVESTMENTS FINTECH
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ecisions on green finance now will lock in emissions trajectories for decades. Financial institutions have a vital role in guiding investment flows from brown to green activities and facilitating low-carbon transition, according to a new report by PwC released at the World Economic Forum. “To capitalise on the increasing global appetite for green assets, the financial sector will play a vital role in channeling investment flows towards green energy and transportation projects,” said Raymund Chao, Asia Pacific chairman, China chairman and CEO, PwC. Banks, insurers, asset owners, and asset managers are reportedly coalescing around frameworks, such as the recommendations of the Task Force on Climate-related Financial Disclosures to measure, manage, and disclose their climate risks, PwC said in its report “Advancing the Green Development of the Belt and Road Initiative: Harnessing Finance and Technology to Scale Up Low-Carbon Infrastructure.” Increasing green financing Financial institutions have also set targets to reduce their exposure to carbon-intensive sectors and increase green financing activities. This is often done in collaboration with initiatives such as the Green Investment Principles under the Belt and Road Initiative, and the Glasgow Financial Alliance for Net Zero, to name a few. Making decisions on green finance is important as it will lock in emissions trajectories for decades, and could reportedly make or break the world’s abilities to achieve the Paris Agreement objective and limit rising global temperatures, the report said. Amongst markets, emerging and developing economies are notedly facing the most challenges as they continue to grapple with having to implement green energy initiatives whilst meeting the rising demand for energy and mobility as they expand, industrialise, and urbanise.
12 ASIAN BANKING & FINANCE | Q2 2022
MAS clarified rules on coverage of losses arising from scams, after OCBC fully shouldered customer losses
SG bolsters digital banking security BANKING TECHNOLOGY
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he Monetary Authority of Singapore (MAS) hit the ground running in the first two months of the year as they unveiled new methodologies for responsible artificial intelligence (AI) use and dealt with losses arising from recent phishing scams that befell bank customers in the Lion City. MAS, along with the Association of Banks in Singapore (ABS), first implemented a plethora of additional measures to bolster the security of digital banking following a phishing scam that affected customers of OCBC. Following this, banks in Singapore were immediately asked to remove clickable links in emails and SMSs sent to retail customers; to set up a system of sending notifications to customers regarding funds transfer at a threshold of $100 or even lower; and to delay activation of the new soft token on a mobile device for at least 12 hours. Clients will also now be informed via text message whenever there is a change in their mobile numbers and email addresses registered. A couple of weeks later, MAS clarified rules on coverage of losses
MAS described OCBC’s goodwill payouts as “a one-off gesture” and that it does not set a general precedent for future phishing cases
AI fair-use in financial institutions MAS also released five whitepapers that detail assessment methodologies for the fairness, ethics, accountability, and transparency principles, meant to guide the use of AI by FIs. The whitepapers were published by the Veritas Consortium, which comprises 27 industry players. Alongside the release of the whitepapers, the Veritas Consortium also released an open-source toolkit meant to help FIs adopt the methodology. The toolkit reportedly enables the automation of the fairness metrics assessment and allows for visualisation of the interface for fairness assessment and for the plug-ins to integrate with FI’s IT systems. The white papers reportedly provide a comprehensive FEAT checklist for FIs to adopt during their Artificial Intelligence and Data Analytics (AIDA) software development lifecycles; and an enhanced Fairness Assessment Methodology to enable FIs to define their AIDA system’s fairness objectives, identify personal attributes of individuals and any unintentional bias. It also has a new Ethics and Accountability Assessment Methodology, which provides a framework for FIs to carry out quantifiable measurement of ethical quantifiable measurement of ethical practices, in addition to the qualitative practices currently adopted. Singapore’s financial regulator is also collaborating with the Infocomm Media Development Authority and the Personal Data Protection Commission to include the Toolkit in PDPC’s Trustworthy AI testing framework.
