MAS outlines transition finance push and resilience investment plans in Singapore

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Highlights

MAS updated the Singapore-Asia Taxonomy covering transition activities in energy, maritime, data centres, and steel, enabling clearer climate mitigation financing guidance.
Pentagreen, under FAST-P, began deploying U.S.$50 million to Candi Solar for Indian SMEs, targeting projects estimated to avert 400,000 tonnes of CO2 annually.
Zurich Insurance Group will open the Zurich Resilience Centre in Singapore in Q1 2027, leveraging data and analytics to improve Asia-Pacific climate risk management.

Transition finance priorities and new tools

As reported by Monetary Authority of Singapore, chief sustainability officer Abigail Ng said at the Singapore Pavilion Finance Day opening on Nov. 11 that Singapore is focusing on turning earlier sustainable finance frameworks into investments with tangible climate benefits.

Ng said MAS is prioritising transition finance through three areas, the taxonomy, financing funds and carbon market capabilities. She said the Singapore-Asia Taxonomy is being used by financial institutions and corporates to structure lending and borrowing frameworks, guide decarbonisation plans and finance eligible activities.

Over the past year, MAS worked with the Singapore Sustainable Finance Association to review the taxonomy, and the association released its second edition on Wednesday. The update covers transition activities in energy, maritime, data centres, and iron and steel, with greater emphasis on climate mitigation outcomes, closer alignment with international frameworks, and expanded guidance on transition-enabling activities and SAT-aligned equity financing.

Ng said the revised taxonomy is already being applied in financing plans. She cited the Fund for Energy Efficiency Technologies, set up in Singapore by the Global Centre for Maritime Decarbonisation and AIM Horizon Investments, which plans to align its investments with the updated transition criteria and deploy capital into vessel energy-efficiency technologies including wind-assisted propulsion systems.

She also pointed to capital deployment under the Financing Asia's Transition Partnership, or FAST-P, saying fundraising alone is not enough if projects do not reach execution. Following a first close in May 2025, Pentagreen has started deploying capital through the GIP and recently announced U.S.$50 million in financing for Candi Solar to help underserved businesses in India, particularly SMEs, adopt solar and battery storage, with the projects expected to avoid about 400,000 tonnes of carbon dioxide emissions a year.

Resilience investment and regional insurance role

MAS is also expanding work on adaptation and resilience as climate finance priorities broaden beyond emissions reduction. Ng said the central bank has started working with industry partners to explore a common language for resilience investments, with the aim of clarifying how different approaches complement each other and where measurement gaps remain.

She said MAS is not seeking a single framework or metric, but instead wants to make the resilience investment landscape easier to navigate and support more capital mobilisation. The approach reflects the view that investors need clearer definitions, workable project economics and better-understood risk allocation before financing can scale.

Ng also highlighted the role of insurers in assessing climate-related risks across an asset's life cycle, from design and construction to operation and potential failure. She said that expertise can help businesses and financiers manage physical climate risks before they materialise.

Zurich Insurance Group announced on Tuesday that it plans to establish the Zurich Resilience Centre in Singapore in the first quarter of 2027. According to Ng, the centre will draw on Zurich's risk expertise, data and analytics to turn risk insights into practical action and strengthen resilience and long-term insurability across Asia-Pacific.

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