Singapore Updates Payment Services Act to Include More DPT Providers Regulations
Summary:
Singapore's Monetary Authority (MAS) plans to revise the Payment Services Act (PS Act) to incorporate more regulatory control over digital payment token (DPT) service providers. The new legal conditions will cover custodial services for DPTs, facilitate token transfers, exchanges and cross-border money transfers, and apply even if money is not accepted or received in Singapore. The changes aim to impose stricter anti-money laundering rules, counter-terrorism financing, user-protection protocols, and ensure financial stability. Companies affected by the amendments have been urged to notify MAS and apply for a license within a specific timeline. MAS also plans to safeguard customer assets by segregating them, maintaining records, and ensuring security measures. Notably, crypto companies such as Crypto.com, Coinbase, and Ripple have earned complete payment institution licenses.
The Monetary Authority of Singapore (MAS), revealed plans to introduce changes to the existing Payment Services Act (PS Act) which would increase the range of regulated services associated with digital payment token (DPT) providers. This announcement was made on April 2nd by the country's central bank, stipulating that the responsibilities under the purview of the PS Act would be extended to include custody services for DPTs, facilitating token transfers and exchanges as well as cross-border money transfers. The changes are expected to enter into fruition in Singapore.
Moreover, MAS clarified that the revised law would apply regardless of whether the service provider physically holds the funds or whether the money is not received or accepted in the country. Integration of new specifications would further enable the central bank to propose additional requirements for DPT service providers. As per MAS officials, the adjustments to existing laws would allow them to enforce conditions related to anti-money laundering, counter-financing of terrorism, user protection and financial stability on DPT service providers.
These modifications will be gradually enforced starting from April 4th. MAS also assured that companies affected by the widened scope would be accommodated by making transitional arrangements. These companies were strongly encouraged by the authority to inform the central bank within a month and apply for official licensing within six months post-April 4th, if they wished to persevere in their operations while their applications were under considerable examination. Probable shutdown of non-compliant companies was also mentioned by MAS, stating entities that failed to meet the conditions must cease activities with immediate effect once the alterations become legally binding.
In addition to this, the regulator will also integrate changes concerning the security of customers' assets amongst payment token service providers. They will ensure distinct customer assets, place them in trust accounts, sustain books and records along with guaranteeing security measures for the protection of customer assets. Laws ensuring customer assets' protection are expected to be legislated six months after April 4th.
Crypto businesses are procuring licenses to offer services to the Singaporean market like Crypto.com, Coinbase and Ripple. These organizations have successfully acquired complete payment institution licenses. Crypto.com secured its Major Payment Institution (MPI) license in June 2023, Ripple obtained approved sanction on Oct. 4, and Coinbase attained the full MPI license on Oct. 2, 2023.
Published At
4/2/2024 10:42:59 AM
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