The Monetary Authority of Singapore (MAS), DBS, HSBC, OCBC, UOB, SPTel and SpeQtral today signed a Memorandum of Understanding (MoU) to embark on quantum security collaboration and study the application of Quantum Key Distribution (QKD) [0] in financial services. QKD can help financial institutions (FIs) protect the exchange of cryptographic keys to address the cybersecurity threats posed by quantum computing.

Quantum computing technology has been developing rapidly and has demonstrated potential to break commonly used cryptography and encryption algorithms. This poses a major cybersecurity concern.  In February 2024, MAS issued an advisory  to all FIs on the cybersecurity risks associated with quantum technology, and provided recommendations for FIs to safeguard themselves against the identified threats, including to carry out proof-of-concept trials with quantum security solutions. More recently, MAS launched a quantum track  under the Financial Sector Technology and Innovation Grant Scheme (FSTI 3.0) to provide funding support for quantum projects and capabilities. This MoU builds on these initiatives and provides a collaborative framework for trialling the application of quantum security solutions in financial services. In the coming months, MAS and participating banks will experiment with QKD solutions jointly provided by SPTel and SpeQtral in the following areas: 

a. Conduct QKD proof-of-concept sandbox on financial sectoruse cases to evaluate its viability, effectiveness and applicability to financial services, and determine the feasibility of using QKD for quantum-safe communications within the financial sector.

b. Validate the security properties of QKD, such as detecting eavesdropping attempts and preventing unauthorised access or tampering of QKD transmissions. This will help to verify QKD’s capability to provide robust security for sensitive data transfers, and enhance trust in its deployment within the sector.

c. Enhance technical competencies through knowledge exchange to equip MoU participants with the skillsets to support the transition towards adopting quantum security solutions when they are commercially available.

Mr Vincent Loy, Assistant Managing Director (Technology), MAS, said, “As quantum technology advances, it is vital for the financial sector to safeguard against potential cybersecurity threats that may be brought about by the technology. The proof-of-concept trials will help MAS and financial institutions better understand QKD’s potential impact on operations and address challenges early. These technology trials can also inform and shape technology and cyber risk management policies towards quantum-proofing our financial systems. We are excited to partner the industry on this initiative and look forward to the learnings and experience that it will bring to our financial sector.”

For a list of quotes from the industry, please refer to Annex A. 

*****

[1] QKD is a secure communication method for exchanging cryptographic keys only known between shared parties.