Investing Updates : CNA Explains: What happens if a Singapore-licensed investment platform goes under?

Source : 

https://www.channelnewsasia.com/singapore/mas-licence-sdic-investment-chocolate-finance-4995486

Apple Intelligence : 

• Investment Protection Discussion: The pause in instant withdrawals on Chocolate Finance sparked discussion on the protection of investments.

• SDIC Coverage Limitation: Money placed with investment platforms like Chocolate Finance is not covered by the SDIC Deposit Insurance Scheme, unlike bank deposits.

• Chocolate Finance’s Assurance: Chocolate Finance, licensed by MAS, assured customers that their funds are safe and held separately by custodians.

• Regulation Requirements: Companies managing funds need a capital markets services license from MAS, considering factors like fitness, track record, management expertise, business plans, and projections.

• Regulated Companies: Prominent investment platforms like Endowus, StashAway, and Chocolate Finance are typically regulated by MAS.

• Benefits of Licensing: MAS-licensed companies are likely to be financially stable, less prone to collapse, and provide consumer confidence due to regulatory oversight.

• Customer Fund Protection: Customers’ funds must be held in segregated, ringfenced accounts and protected by a robust custodian framework.

• Risk Management and Transparency: Companies must have a risk management framework and provide clear, transparent disclosures on service terms.

• Company Failure Protection: While funds are protected, customers may still experience delays in accessing their money if a company fails, and the government may provide implicit guarantees.

• Market Impact of COVID-19: Heightened market volatility caused by the COVID-19 pandemic.

• Potential Losses for Customers: Customers forced to liquidate portfolios could suffer losses.