Monetary Authority of Singapore Finanalises Payment Services Regulation
The Monetary Authority of Singapore (MAS) has finalised a new regulatory framework for payment services in the market. The so-called Payment Services Bill, is aimed at enabling innovation in payment services and mitigating risks across the value chain. The bill merges the regulation of payment services within a single activity-based legislation. It is comprised of two parallel regulatory frameworks. The first is a designation regime that enables MAS to regulate systemically important payment systems in order to maintain efficiency and financial stability. The second, a licensing regime that focuses on retail payment services provided to customers and merchants.
The activity-based licensing framework for retail payment services facilitates innovation and mitigates risks. The licence regime has been broadened to encompass a wider range of payment activities, including domestic money transfers, merchant acquisition and the purchase and sale of digital payment tokens. At any point in time, a payment service provider needs only to hold one licence, but of a class that corresponds to the risk posed by the scale of payment services provided. Risk mitigating measures will then be tailored to the specific payment services that a licensee provides to better safeguard customer and merchant monies, ensure adequate controls against money laundering and terrorism financing risks, reduce fragmentation and strengthen technology and cyber standards in the payments space.