Singapore’s New Payment Services Bill
The eagerly awaited Payment Services Bill was moved for first reading in Parliament, intended to streamline the regulation of payment services within a single activity-based legislation, as compared to when the MAS previously regulated various types of payment services under the Payment Systems (Oversight) Act (Cap. 222A) (“PS(O)A”) and the Money-Changing and Remittance Businesses Act (Cap. 187) (“MCRBA”), enacted in 2006 and 1979 respectively.
The Bill comprises two parallel regulatory frameworks:
- The first framework is a designation regime which enables MAS to designate significant payment systems and regulate operators, settlement institutions and participants of these designated payment systems for financial stability reasons1as well as for efficiency reasons.
- The second framework is a licensing regime that 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 license, but of a class that corresponds to the risk posed by the scale of payment services provided.
The Bill provides transitional arrangements for existing regulated entities, as the PS(O)A and the MCRBA will be repealed, as well as powers to make transitional arrangements for entities currently providing the new payment services but are not regulated. Transitional arrangements of between six and 12 months will be provided to facilitate a smooth transition of these entities into the new regulatory framework, and allow entities sufficient lead time to comply with new requirements.
Date: 19 November 2018