Oversea-Chinese Banking Corporation (OCBC) is embarking on a year-long research collaboration with three universities in Singapore to explore how quantum technology could reshape banking operations.
The bank will work with the National University of Singapore (NUS), Nanyang Technological University (NTU), and Singapore Management University (SMU) to examine quantum applications in the areas of derivative pricing, data security and fraud detection.
“[The use cases we’ve selected are those] best fit for the technology. Quantum technology’s strength lies in solving complex mathematical problems such as cryptography for data security,” says Peter Koh, OCBC’s head of group technology architecture, at a media briefing on July 17.
Quantum computing can rapidly process extensive data sets and provide enhanced computational power, promising to solve problems beyond the reach of today’s supercomputers more efficiently and accurately.
As part of the collaboration, OCBC and NUS will explore the use of quantum algorithms to accelerate Monte Carlo simulations, a key tool used in pricing financial derivatives. Doing so could speed up simulations while improving precision, allowing for near real-time portfolio rebalancing and more complex risk modelling.
“While my academic group has a deep understanding of the interface of quantum algorithms and mathematical finance, this project with OCBC gives us the opportunity to apply the theory in practice. In close collaboration with the team at OCBC, we are taking substantial steps towards the realisation of quantum algorithms for the pricing of complex financial derivatives,” shares Assistant Professor Patrick Rebentrost, Principal Investigator, Centre for Quantum Technologies, and faculty member, Department of Computer Science, NUS School of Computing.
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With SMU, OCBC is researching the use of quantum machine learning (QML) to enhance fraud detection. These techniques could help identify anomalies in complex and unstructured datasets more quickly than conventional systems.
“Quantum computing enables us to uncover patterns in fraud detection that are invisible to classical methods—particularly in noisy, high-dimensional data environments,” says Associate Professor Paul Griffin, Principal Investigator at SMU’s School of Computing and Information Systems.
He adds that the research will run on a quantum simulator, which mimics how a real quantum computer operates but is currently more practical for small-scale experiments. The application can move to a real quantum computer when it is ready to be scaled up.
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Meanwhile, the partnership with NTU focuses on post-quantum cryptography (PQC), a set of advanced encryption techniques designed to protect sensitive data from potential quantum-enabled cyberattacks.
“As quantum computing advances, the urgency to secure digital systems against future threats becomes critical, especially in the banking sector, where trust and data protection are paramount. At NTU, we are leveraging our deep expertise in PQC to develop solutions that can withstand next-generation cyberattacks,” says Professor Wang Huaxiong of NTU’s School of Physical and Mathematical Sciences. He also serves as director at the Strategic Centre for Research in Privacy-Preserving Technologies & Systems (SCRIPTS) and co-director at the Digital Trust Centre (DTC).
Findings from the research collaborations will be published in technology-focused research papers and journals. This will enable the banking sector to assess the suitability of applying quantum technology to key banking operations and potentially accelerate the adoption of this technology.
Quantum technology is not new to OCBC. It has developed a quantum roadmap in 2021 as part of a multi-year strategy to advance its technological capabilities and stay at the forefront of innovation.
OCBC has also been building in-house quantum expertise as part of the roadmap. Koh shares that about 50 employees, mostly from its technology team, now possess intermediate proficiency in quantum concepts. Some will be directly involved in the university-led research.
Praveen Raina, head of Group Operations and Technology at OCBC, says: “The industry-academia exchange [will] drive research and innovation by merging practical insights and real-world use cases with domain expertise and knowledge. [It] also illustrates how we are taking bold, proactive steps to test emerging technologies, even when their commercial potential is still unfolding.”
The research collaborations will complement the pilots that OCBC are part of.
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For instance, OCBC trialled quantum key distribution (QKD) — a hardware-based encryption method that uses quantum mechanics to transmit data securely — over Singtel’s quantum-safe network last year.
Koh shares that the trial showed that QKD is effective over short distances such as within Singapore but is currently limited in cross-border use, such as between Singapore and Malaysia. He adds that OCBC is now seeking partners to scale deployment across its data centres and offices locally.
Beyond that, OCBC is among the banks that participated in a sandbox led by the Monetary Authority of Singapore (MAS) to test QKD last year. MAS announced the completion of the initiative on Tuesday (July 15) and will publish findings from the trial soon.
