Progressive Approach In Embracing The Digital Finance Key To Labuan IBFC's Growth In Financial Innovation

Author:Ms Rowena Wong and Nadia Shariff
Profession:Labuan IBFC Inc
 
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The centre has a ready-made "toolbox" of solutions to meet industry needs

Kuala Lumpur, 12 December 2019 - "Labuan International Business and Financial Centre's (Labuan IBFC's) "digital family" continues to grow in recognition of the progressive approach the centre has taken in embracing the digital revolution by being as facilitative as possible to enable innovative digital business to take root in Labuan," said Labuan Financial Services Authority (Labuan FSA) Director-General, Danial Mah Abdullah at the inaugural Connecting Digital Ecosystems in Asia 2019 (CoDE Asia 2019) conference in Kuala Lumpur today.

Mah added: "To this extent, the centre has used legacy licences like money broker, credit token licenses to provide the regulatory umbrella for the digital business to be carried out. Now that is innovation by itself. Thus, the centre has a "toolbox" of solutions to meet the needs of the rapidly expanding digital industry, whether from the supply or demand side".

He went on to add that the digital business model must be legitimate, meeting international standards of compliance, transparency and prudential requirements. Thus, prospects would need to obtain Labuan FSA's prior approval for any proposed digital business if the activities fall within the ambit of Labuan Financial Services Securities Act 2010 or Labuan Islamic Financial Services Securities Act 2010.

Labuan IBFC's digital journey began in 2017, with eight licenses up to 2018 and 2019 has seen an exponential growth in the number of players in the centre with more than 30 licenses approved to operate as digital entities. These businesses range from financial services such as digital banking and insurtech to digital intermediaries such as robo-advisory, digital asset exchanges, crypto trading platforms, blockchain tokens as well as e-payment systems.

"Our bespoke and curated approach is an ideal match to the demands of a fast-evolving digital marketplace," said Farah Jaafar-Crossby, CEO of Labuan IBFC Inc, the jurisdiction's market development agency...

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