Singapore Fintech Startups Face Funding Squeeze and Talent Gap, While Hong Kong and Abu Dhabi Beckon

Date:

Singapore’s fintech startups are facing a funding squeeze and a talent gap, while cities like Hong Kong and Abu Dhabi are presenting attractive opportunities for qualified professionals. Singapore’s robust fintech workforce of 18,000 may not be eager to add to their numbers due to uncertain growth prospects and limited access to funding. However, the situation in Hong Kong and Abu Dhabi is different, prompting Singapore to reassess its immigration policies.

According to a 2021 Accenture survey, nearly two-thirds of companies cited the inability to secure work permits for foreigners as the main reason for their talent gap. However, Hong Kong’s recent introduction of the Top Talent Pass program is changing the game. This initiative grants a 24-month visa to graduates of prestigious universities without requiring a job offer. As a result, Hong Kong issued 100,000 work permits in the first nine months of the program, almost 2.5 times more than the previous year.

Singapore cannot afford to downsize its fintech workforce when Hong Kong is actively expanding. Singapore’s fintech sector has experienced a decline in deal volumes, with only $1 billion recorded in the first three quarters of the year, compared to $5.5 billion in 2021 and $2.6 billion in 2022. Furthermore, Hong Kong has gained Beijing’s support to position itself as a retail hub for trading virtual assets, further intensifying competition.

The immigration issue also plays a role in Singapore’s talent shortage. Strict controls on overseas-worker visas affect all industries, including banking and fintech. With almost 40 percent of Singapore’s 5.9 million population consisting of non-citizens, a sudden reversal in policy is unlikely. Instead, Singapore is focusing on filling the void left by departing overseas workers during the pandemic. This cautious expansion strategy aims to attract fresh talent and maintain Singapore’s innovation leadership, particularly in trade and finance.

See also  Google's AI chatbot Bard takes on ChatGPT: Expert opinions revealed

To achieve this, Singapore needs professionals in various roles such as software developers, sales and compliance specialists, artificial intelligence engineers, and product managers. While the hype around cryptocurrency ventures has diminished, Singapore’s central bank remains interested in tokenizing financial assets in collaboration with major institutions like JPMorgan Chase & Co, Citigroup Inc, and T Rowe Price Group Inc. Similarly, the interest in artificial intelligence is growing, as evidenced by its central theme in this year’s fintech festival.

Singapore faces competition not only from Hong Kong but also from Abu Dhabi. Abu Dhabi’s efforts to attract AI talent are leading it to implement a points-based system for employment passes, which rewards applicants with skills in high demand and firms contributing to Singapore’s strategic economic priorities.

However, competition for talent is not only coming from other cities. Large technology companies and financial institutions also pose a challenge by potentially overshadowing smaller ventures. According to the Accenture survey, 64 percent of firms reported that candidates prefer working for incumbents due to factors such as job stability, career progression opportunities, and market-aligned benefits.

Despite funding constraints, Singapore’s fintech startups still aspire to hire, albeit at a less accelerated pace compared to previous years. While obtaining work permits remains challenging, it is less of a hurdle than before. The red carpet rolled out by competing employment centers and larger firms ensures this. Singapore must secure its position in the fintech industry by balancing the talent shortage, attracting skilled professionals, and providing the necessary resources to foster innovation.

Frequently Asked Questions (FAQs) Related to the Above News

Why are Singapore's fintech startups facing a funding squeeze and a talent gap?

Singapore's fintech startups are facing a funding squeeze due to uncertain growth prospects and limited access to funding. Additionally, there is a talent gap because of difficulties in securing work permits for foreigners.

How is Hong Kong attracting fintech talent?

Hong Kong has introduced the Top Talent Pass program, which grants a 24-month visa to graduates of prestigious universities without requiring a job offer. This has led to an increase in work permits issued by Hong Kong, attracting fintech talent.

How has Singapore's fintech sector been performing compared to Hong Kong?

Singapore's fintech sector has experienced a decline in deal volumes, with only $1 billion recorded in the first three quarters of the year, compared to $5.5 billion in 2021 and $2.6 billion in 2022. In contrast, Hong Kong's fintech sector is expanding.

How are immigration policies affecting Singapore's talent shortage?

Strict controls on overseas-worker visas in Singapore affect all industries, including banking and fintech. This contributes to the talent shortage in the fintech sector.

What is Singapore's strategy for addressing the talent shortage?

Singapore is focusing on filling the void left by departing overseas workers during the pandemic. It aims to attract fresh talent and maintain its innovation leadership, particularly in trade and finance.

What roles does Singapore need professionals for in the fintech sector?

Singapore needs professionals in various roles such as software developers, sales and compliance specialists, artificial intelligence engineers, and product managers.

What are some of the challenges Singapore faces in attracting talent?

Singapore faces competition from other cities like Hong Kong and Abu Dhabi, as well as from large technology companies and financial institutions that can potentially overshadow smaller fintech ventures. Candidates often prefer working for incumbents due to factors like job stability, career progression opportunities, and market-aligned benefits.

Are Singapore's fintech startups still hiring despite funding constraints?

Yes, while funding constraints exist, Singapore's fintech startups still aspire to hire, albeit at a slower pace compared to previous years. The red carpet rolled out by competing employment centers and larger firms has made obtaining work permits less of a hurdle.

Please note that the FAQs provided on this page are based on the news article published. While we strive to provide accurate and up-to-date information, it is always recommended to consult relevant authorities or professionals before making any decisions or taking action based on the FAQs or the news article.

Share post:

Subscribe

Popular

More like this
Related

Samsung’s Foldable Phones: The Future of Smartphone Screens

Discover how Samsung's Galaxy Z Fold 6 is leading the way with innovative software & dual-screen design for the future of smartphones.

Unlocking Franchise Success: Leveraging Cognitive Biases in Sales

Unlock franchise success by leveraging cognitive biases in sales. Use psychology to craft compelling narratives and drive successful deals.

Wiz Walks Away from $23B Google Deal, Pursues IPO Instead

Wiz Walks away from $23B Google Deal in favor of pursuing IPO. Investors gear up for trading with updates on market performance and key developments.

Southern Punjab Secretariat Leads Pakistan in AI Adoption, Prominent Figures Attend Demo

Experience how South Punjab Secretariat leads Pakistan in AI adoption with a demo attended by prominent figures. Learn about their groundbreaking initiative.