“Singapore’s National AI Programme in the Real World” – Opening Speech by Mr Tan Kiat How, Senior Minister of State, Ministry of Communications and Information & Ministry of National Development, at the Project NovA! Launch Event


1. Good afternoon. Thank you for inviting me to join you for today’s Capital Meets Policy Dialogue.

2. The Capital Meets Policy Dialogue has been a hallmark of past editions of the Singapore FinTech Festival.

a. It brings together diverse stakeholders – regulators, policymakers, global investors, capital providers and many others, to come together and discuss issues that shape the future of financial technology.

3. This year, the FinTech Festival focuses on Artificial Intelligence, or AI. It is timely.

a. Amongst the many interesting topics related to AI, I am glad that there are also discussions on using AI within financial services to accelerate our transition towards a low-carbon future.

Accelerating our transition towards a low-carbon future

4. Transitioning towards a low-carbon future is critical to our ability in mitigating the impact of climate change.

5. In fact, we are already experiencing the severity of climate change today.

a. Just two weeks ago, it was reported that Singapore experienced its hottest October day on the 9th of October. Temperatures exceeded 35 degrees Celsius in several parts of the country, hitting 36.3 degrees Celsius in Admiralty.

b. This is not an isolated spike. In fact, the Meteorological Service Singapore has reported that temperatures in Singapore have been on the rising trend since the mid-1970s, due to global warming and the Urban Heat Island effect.

6. We have also seen severe weather events being reported all around the world.

a. From the record-breaking rainfall in Hong Kong and southern China in September which led to flooding in city streets,

b. To the recent devastating wildfires in Hawaii which not only destroyed homes and infrastructure but also tragically claimed lives of residents.

7. These events underscore the urgency of this climate crisis.

a. We need to take action today to flatten the emissions curve and set us on the right path towards net-zero by 2050.

8. To do our part, just last year, Singapore stepped up our climate ambitions to peak our emissions earlier and reduce them to around 60 million tonnes of carbon dioxide equivalent in 2030.

9. We have also committed to reach net-zero by 2050.

10. Buildings account for nearly 40% of carbon emissions globally. In Singapore, they account for over 20%. Therefore, greening buildings move the needle in our low-carbon transition.

11. In support of these national ambitions, the Building & Construction Authority (BCA) and the Singapore Green Building Council launched the latest edition of the Singapore Green Building Masterplan (or SGBMP) in 2021.

12. The SGBMP sets out three ambitious targets, or “80-80-80 in 2030” to accelerate our transition to a low-carbon built environment.

a. These are to green 80% of our buildings by 2030,

b. For 80% of new developments to meet Super Low Energy standards from 2030, and

c. For our best-in-class buildings to achieve 80% improvement in energy efficiency over 2005 levels by 2030.

13. To meet these targets, businesses and investors can play a leading role by channelling funds into green initiatives and low-carbon building projects.

Launch of NovA! Phase 2

14. On this note, I am delighted to announce the launch of Phase 2 of NovA! that takes this effort a step further.

15. Led by the Monetary Authority of Singapore (MAS) and the Smart Nation Digital Government Office (SNDGO), and developed in collaboration with industry experts, NovA! is a platform that leverages AI and data analytics to support financial institutions and companies on their sustainability journey.

a. It empowers financial institutions to generate insights from big data and employ AI for faster and more informed decisions regarding sustainable financing.

b. Consequently, NovA! also streamlines the process for borrowers, such as real estate owners and developers, by allowing them to access green funds more conveniently, and at an earlier stage.

c. In a nutshell, NovA! uses AI and data analytics to unlock opportunities for sustainable financing, combat greenwashing and help financial institutions manage climate risk.

16. Phase 1 of NovA! showed promise in the real estate sustainability-linked loans (or SLL) market.

a. SLLs have surged in popularity in recent years.

b. SLLs incentivise environmentally sustainable business activities by tying a borrower’s interest rates to their achievement of pre-determined sustainability performance targets (or SPTs).

c. These SPTs are validated by independent Environmental, Social and Governance (ESG) rating agencies or verification parties.

17. There are several challenges that confront the real-estate SLL market today.

a. For instance, there is a lack of sustainability-related data in the SLL market, making it difficult for financial institutions to set well-defined SPTs and make informed lending decisions.

b. There are also greenwashing concerns, where the sustainability-related declarations may not reflect the actual sustainability profile of the business.

c. As a result, funds may be invested in projects that do not advance sustainability, and this affects the ability of financial institutions to meet their own net-zero goals.

d. Currently, banks adopt manual effort to read and interpret various types of disclosures from lenders when setting and monitoring SPTs. This is not only time-consuming but error prone, and can have downstream impacts in terms of ensuring compliance.

18. The NovA! minimum viable product (MVP) has built in some core features to address these problems.

a. First, NovA! provides peer and industry benchmarking to help banks and lenders set SPTs that are ambitious, yet achievable. This benchmarking helps banks and lenders to avoid making their loans unattractive, and reduces the risk of greenwashing by borrowers.

b. Second, NovA! allows banks and lenders to continuously monitor and track their borrowers’ performance against the SPTs to curb greenwashing. This not only allows banks and lenders to intervene early if a borrower’s performance deviates from their SPTs, but also enables proactive interventions through AI-powered forecasts of future performance.

c. Third, NovA! also uses an Autonomous Documentation Insights Engine (ADIE). This is a shift away from manual processing of disclosure documents, and enables timely and accurate extraction of sustainability insights from diverse sources.

19. By promoting greater transparency and convergence of data as well as the use of automation, the NovA! minimum viable product enables banks and lenders to offer SLLs with much greater confidence.

a. This in turn empowers banks and lenders to play a more pivotal role in driving sustainable development, while achieving positive business outcomes.

20. I’m glad that Phase 2 development of NovA! will be done in collaboration with BCA.

a. Data and services from BCA’s Super Low Energy Building database will now be extracted by NovA!.

b. This will unlock country-wide data on green buildings to refine the AI model, which can better evaluate the energy efficiency levels of buildings.

21. Such a development promises to significantly accelerate green financing within the real estate sector.

a. Developers and building owners will be able to use NovA!-S-L-E-B to preliminary assess the sustainability impacts of their projects.

b. Financial institutions can also use the platform to help them appraise green loan requests and verify the achievement of SPTs.

22. I am heartened to see strong industry support for innovations like NovA! and hope to see such innovations being applied in other sectors beyond buildings, such as power and transport.


23. This collaboration is a good example of how greater impact can be achieved by bringing ecosystems and diverse stakeholders together– capital and green buildings in this case, and empowering ideas with technologies like AI.

24. Importantly, Singapore must always strive to be relevant and be an important platform to catalyze such innovations, bring ideas into reality and make an impact on consequential issues that matter to Singapore and the world.

25. Thank you once again for inviting me here today. I wish all of you a fruitful conference, and look forward to the insightful discussions later.