Getting Started with MAS License Application in Singapore: A/I LFMC Guide

According to the latest Monetary Authority of Singapore (MAS) Asset Management Survey, total Assets Under Management (AUM) in Singapore reached S$5.4 trillion, with over 1,400 licensed and registered fund managers operating in the jurisdiction. As capital continues to flow into Asia’s premier financial hub, fund managers seeking to pool and manage institutional and accredited investor capital must secure appropriate regulatory authorization under the Securities and Futures Act (SFA).

If you are evaluating how starting a Capital Markets Services (CMS) licence company fits into your fund structure, obtaining an Accredited/Institutional Licensed Fund Management Company (A/I LFMC) licence from the Monetary Authority of Singapore (MAS) provides an ideal, uncapped path for portfolio management.

This guide outlines eligibility criteria, executive competency standards, compliance framework requirements, and the step-by-step application workflow for securing an A/I LFMC licence in Singapore.

Navigating MAS Regulations & Licences (4-Part Series)

This guide is Part 1 of our four-part series on key MAS licensing and registration pathways:

• Part 1: Accredited/Institutional Licensed Fund Management Company (A/I LFMC) (Current Guide)
• Part 2: Major Payment Institution (MPI) / Standard Payment Institution (SPI)
• Part 3: Venture Capital Fund Management Company (VCFM)
• Part 4: Registered Insurance Broker

What is an A/I LFMC Licence?

An Accredited/Institutional Licensed Fund Management Company (A/I LFMC) holds a Capital Markets Services (CMS) licence for fund management issued by MAS under the SFA. This licence authorizes the holder to carry out portfolio management activities exclusively for:

• Accredited Investors (AIs): Individuals with net personal assets exceeding S$2 million (or net financial assets exceeding S$1 million), or annual income in the preceding 12 months of at least S$300,000; or corporations with net assets exceeding S$10 million.
• Institutional Investors (IIs): Statutory boards, banks, insurance companies, and regulated financial institutions.

Key Differences: A/I LFMC vs. RFMC (Repealed Regime)

The Registered Fund Management Company (RFMC) regime was officially repealed by MAS on 1 August 2024. All former RFMCs were required to transition into the A/I LFMC regime or cease regulated operations.

Core Eligibility & Pre-Application Requirements

MAS evaluates licence applicants on operational substance, leadership competency, and ongoing financial strength.

1. Corporate Structure & Local Presence

• Entity Type: Must be a Singapore-incorporated company with a physical office in Singapore.
• Commercial Substance: Must demonstrate functional decision-making, portfolio management, and compliance governance operating locally in Singapore.

2. Financial & Base Capital Requirements

• Minimum Base Capital: Maintain a minimum base capital of S$250,000 at all times.
• Risk-Based Capital (RBC): Maintain Financial Resources that equal or exceed 120% of the Total Risk Requirement (TRR) pursuant to MAS Notice SFA 04-N13.
• Capital Buffer: Applicants should inject additional capital reserves above S$250,000 to cover operational overhead during early-stage deployment.

3. Executive Directors, CEO & Representative Criteria

MAS enforces strict competency thresholds for key personnel based in Singapore:

4. MAS Fit and Proper Criteria

All substantial shareholders, directors, key executive officers, and representatives must satisfy the MAS Guidelines on Fit and Proper Criteria, evaluating:

1. Honesty, Integrity, and Reputation: Absence of civil or criminal convictions and adverse regulatory findings.
2. Competence and Capability: Academic qualifications, technical expertise, and verifiable investment track record.
3. Financial Soundness: Freedom from personal bankruptcy proceedings or corporate insolvency filings.

Establishing a Compliance & Risk Governance Framework

Incomplete or off-the-shelf compliance policies are a common cause for application processing delays or rejections. Before applying, applicants must establish governance frameworks aligned with MAS Capital Markets Services (CMS) licence guidelines.

Core Operational Policies Required

• AML/CFT Framework: Anti-Money Laundering and Countering the Financing of Terrorism policies covering Customer Due Diligence (CDD), ongoing monitoring, and an Enterprise-Wide Risk Assessment (EWRA).
• Risk Management Systems: Documented frameworks for credit, market, operational, and liquidity risk controls.
• Compliance Policies: Rules for personal account trading, conflicts of interest, trade allocation, gifts and entertainment, and insider dealing.
• Asset Safeguarding: Independent custodial arrangements for client asset segregation.
• Business Continuity & Cyber Hygiene: Comprehensive BCP testing and cybersecurity safeguards.

Step-by-Step MAS A/I LFMC Application Workflow

The standard timeline for securing an A/I LFMC licence ranges from 4 to 6 months, depending on documentation completeness and business model clarity.

1. Phase 1: Pre-Application Setup (Weeks 1–4): Incorporate the Singapore private limited company via Alder’s corporate and regulatory services. Appoint key directors and executives, secure physical office premises, and draft compliance manuals.
2. Phase 2: Form 1A Lodgement (Week 5): Complete and submit Form 1A (Application for a CMS Licence for Fund Management) online via the MAS-Tx portal, along with the non-refundable S$1,000 application fee.
3. Phase 3: MAS Assessment & Clarification (Months 2–4): MAS reviews the submission, assesses executive background checks, and issues formal queries.
4. Phase 4: In-Principle Approval (IPA) (Month 5): MAS grants an IPA letter valid for 6 months, specifying conditions to fulfill prior to licence grant.
5. Phase 5: Licence Activation (Month 6): Fulfill IPA conditions (e.g., final capital injection, executing custodian agreements) to receive the official CMS licence.

Frequently Asked Questions (FAQs)

How Alder Can Assist Your A/I LFMC Application

Navigating MAS regulatory requirements, structuring governance frameworks, and preparing Form 1A submissions can be complex. Alder provides end-to-end licensing support, helping fund managers assess eligibility, draft compliance documentation, and manage regulatory communication with MAS.

Contact Alder’s regulatory compliance team today to schedule a consultation and launch your fund management business in Singapore.

This article is for general information only and does not constitute legal or regulatory advice.