The Monetary Authority of Singapore (MAS), along with DBS, HSBC, OCBC, UOB, SPTel, and SpeQtral, has entered into a Memorandum of Understanding (MoU) to collaborate on quantum security initiatives. The partnership aims to explore the application of Quantum Key Distribution (QKD) in the financial services sector. QKD offers a way for financial institutions to secure the exchange of cryptographic keys, addressing cybersecurity risks posed by advances in quantum computing.
As quantum computing progresses rapidly, it has shown the potential to compromise existing cryptographic and encryption methods, raising significant cybersecurity concerns. In February 2024, MAS issued an advisory to all financial institutions (FIs) highlighting the cybersecurity risks associated with quantum technology. The advisory recommended that FIs implement measures to protect against these threats, including conducting proof-of-concept trials with quantum security solutions. Additionally, MAS recently introduced a quantum track under the Financial Sector Technology and Innovation Grant Scheme (FSTI 3.0) to support quantum-related projects and capabilities.
This MoU builds on these ongoing initiatives by establishing a collaborative framework for testing quantum security solutions within financial services. Over the coming months, MAS and the participating banks will work together to test QKD solutions provided by SPTel and SpeQtral in the following areas:
a. Conducting QKD proof-of-concept sandboxes for financial sector use cases to assess its viability, effectiveness, and applicability, and to determine the feasibility of using QKD for quantum-safe communications in the financial sector.
b. Validating the security properties of QKD, including its ability to detect eavesdropping and prevent unauthorised access or tampering with QKD transmissions. This will verify QKD’s effectiveness in securing sensitive data transfers and build trust in its deployment.
c. Enhancing technical expertise through knowledge sharing, equipping MoU participants with the skills necessary to support the adoption of quantum security solutions when they become commercially available.
Vincent Loy, Assistant Managing Director (Technology) at MAS, stated, “As quantum technology progresses, it is essential for the financial sector to proactively address potential cybersecurity risks. These proof-of-concept trials will allow MAS and financial institutions to gain a deeper understanding of QKD’s impact on operations and to address challenges early. The insights gained from these trials will help shape technology and cyber risk management policies to ensure our financial systems are quantum-proof. We are pleased to partner with the industry on this important initiative and look forward to the valuable learnings it will provide to our financial sector.”
Source: MAS