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Singapore central bank proposes to ease some rules for robo-advisers

Singapore's central bank plans to ease rules for robo-advisory services to support innovation in financial services.

The Monetary Authority of Singapore said June 7 it plans to refine the licensing and business conduct requirements of digital advisory services to make it easier for the entities to operate in Singapore.

Digital advisers that operate as fund managers under the Securities and Futures Act will be allowed to offer their services to retail investors even if they do not meet the track record requirement so long as they meet certain safeguards, which include offering diversified portfolios of noncomplex assets, having key management staff with relevant collective experience in fund management and technology and undertaking an independent audit of the digital advisory business.

Meanwhile, robo-advisers that operate as financial advisers under the Financial Advisers Act will be allowed to assist clients to execute their investment transactions and rebalance their clients' investment portfolios in collective investment schemes without the need for an additional license.

Digital advisers can also seek an exemption from the FAA requirement to collect a full suite of information on the financial circumstances of the client if they can mitigate the risks of providing inadequate advice based on limited client information.

The MAS will collect public comments on the proposed rules until July 7.