In this article, Kieran McKenna, Associate Director for Kerry Consulting’s Technology Practice, provides analysis of the hiring patterns of MAS-licensed digital banks in Singapore.
With the recent digital bank launches in Singapore, we thought it prudent to analyse how these outfits are hiring.
Digital banks offer banking facilities exclusively via digital platforms, including mobiles and tablets. They are becoming increasingly common as they appeal to digital natives. Singapore – a tech-forward country – is naturally going to become a large market for digital banking services.
Those that achieve success will do so by creatively exploiting the ecosystem of their founder companies. They have realised that to expand and progress in what will be an ultracompetitive space, they need to relocate existing staff to their digital banking products and pursue an aggressive hiring strategy to acquire more talent.
Talent Requirements Beginning to Shift
We are at an interesting juncture because most digital banks in Singapore are still at the ‘build’ phase, and so their hiring requirements are strongly focused on engineering and tech talent that can develop their platform. According to LinkedIn data*, 32% of a major new digital bank’s current employees are listed as working in engineering, IT and adjacent tech-related functions. This contrasts with a traditional bank with a large presence in Singapore, where the same fields are roughly 15% of the bank’s staff make-up.
I expect that, as digital banks launch, their talent requirements will begin to shift. While significant weight is being allocated to acquiring technology and development staff now, niche talent – Risk and Fraud Specialists, for example – will be in the crosshairs when operations move closer to the ‘maintenance’ phase.
Traditional finance talent is of course required by digital banks. But the tech-led nature of digital banks will lead recruiters to those with stronger Agile maturity who may, for example, have worked in a Fintech start-up. Digital banks see themselves differently to traditional banks and so I expect that culture fit will continue to be a chief priority outside of experience, skills, and qualifications. For this reason, I believe that digital banks will be more willing to look outside of the traditional banking sector to acquire the right staff.
Where are the MAS Digital Exclusive Banks Hiring From?
The ranks at traditional Singaporean banks have become well-trodden hunting grounds for the newer digital only outfits. It is unsurprising that 45% of external hires for digital banks have worked at a traditional Singaporean bank previously. This reflects the heavy emphasis that digital banks have placed on acquiring staff from retail banking, a space in which the traditional Singaporean banks remain dominant.
Staff with experience at international banks are fewer but still prevalent; 28% of external hires have worked for UK, European or US banks previously. The larger consulting firms are also being targeted. According to the data available, over 29% of the Singaporean pool of digital bank workers have previously been employed at a major consulting firm such as Accenture, Deloitte, PWC, KPMG or EY.
Level of Experience and Current Tenure
Professionals with various levels of experience are being hired by digital banks. 60% of those on LinkedIn have 2-5 years (31%) and 5-10 years of experience (29%). 16% of staff have 1-2 years of experience and only 2% have less than a year. 22% of staff have more than 10 years’ experience. Perhaps these demographics reflect the vigorous commitment required by the digital bank’s employees throughout this intense ‘build phase’.
A whopping 56% of digital bank staff have spent less than a year in their current position, with another 39% employed for between 1-2 years.
This means that only 4% of digital bank staff have spent longer than 2 years in their role. Considering the youth of the sector, these figures are entirely understandable – MAS granted the first four licenses in late 2020.
Fields of Study
With 72% of external hires coming from traditional banks, it is understandable that General Finance and Economics are the largest area of study among new recruits. Accounting is well represented too, as is Computer Science and Business/Commerce.
What Skill Sets/Functions are Sought After?
The consensus among the digital banks is that they need to replicate the staffing structure of a traditional bank with a stronger focus on technology areas. Artificial Intelligence and Digital Innovation are some of the areas that digital banks are keen to build out and bolster with qualified staff. Cybersecurity and Engineering are two areas where recruiters are witnessing particularly relentless competition.
It is also worth noting that, due to the virtual nature of their products and services, digital banks need less traditional Front Office and Sales staff. This is because these banks will not have brick-and-mortar locations where skillsets associated with these positions are required.
Expectations for the Future
The high demand for engineering and IT staff at digital banks will always be there. A reliance on solid technology makes those functions necessary for survival. I do expect that, due to the current talent crunch, digital banks will need to look further outside of the technology wings of traditional banks to secure essential talent in the coming years.
Hiring scope will widen to include more technology companies that work on products and services either adjacent or entirely different to traditional banking. This outcome is to be expected, especially when you consider that the parent companies of many digital banks are technology outfits themselves.
In the coming years I believe that we will see more banking professionals make the switch from traditional to digital banks as many already have. The switch is far less drastic than to the likes of the digital asset industry, and so I believe it is a realistic and palatable option for industry veterans eager for a change. These switches will always be contingent on the hires being the right culture fit. As tech-first businesses, the digital banks want their staff to be digitally fluent and to be able to adapt to the pace. This may prove difficult for candidates in larger banks where things are being done more slowly.
Kieran McKenna is an Associate Director of our Technology Practice. Kieran has been working in the search industry since 2008. Prior to joining Kerry Consulting he worked for two leading recruitment firms in Singapore and London. Kieran specialises in mid-to-senior level searches across Technology Project Management (including Project Managers, Program Managers, AGILE practitioners, Scrum Masters, PMO) and Digital (including Product Owners, Change Management & Digital Transformation leaders, Innovation leaders). He holds a Bachelor of Arts honours Degree in German History & Philosophy from University of London.
If you would like to reach out to Kieran for a confidential conversation on your hiring strategy he can be contacted at email@example.com
Digital & Innovation, PMO and Project Management