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MAS Proposes New Regulatory Framework and Governance Model for Payments

The Monetary Authority of Singapore (MAS) released a consultation paper on proposed changes to the payments regulatory framework and establishment of a National Payments Council.

Proposed Activity-Based Payments Framework

Singapore’s payment regulations currently cut across two pieces of legislation: the Payment Systems (Oversight) Act (PS(O)A) and the Money-changing and Remittance Businesses Act (MCRBA), which govern stored value and remittances respectively. With technological advances and the advent of FinTech, the lines between payments and remittance are blurring; new payment providers are emerging and some do not fit neatly into these categories.

Singapore City Cities Skyline. From Pixabay

MAS proposes to bring these regulations under a single framework that will provide for the licensing, regulation and supervision of all payments services, including stored value facility holders, remittance companies, and virtual currency intermediaries. Regulation will be applied on an activity basis, and entities will only be required to apply for a single licence to undertake several payment activities. The proposed framework aims to strengthen standards of consumer protection, anti-money laundering, and cyber security related to payment activities, while facilitating innovation and system interoperability.

Proposed National Payments Council

Singapore’s payments landscape is characterised by the availability of several well-established payment solutions, such as cheques, fund transfers, stored value facilities, credit and debit cards, and internet-based payment platforms. While offering variety and choice for consumers, this has also led to a perceived fragmentation of payment services.

MAS proposes to establish a National Payments Council to coordinate key initiatives such as promoting interoperability and adopting common standards. The payments council will draw its members from among users and providers of payment solutions, and foster collaboration among stakeholders to promote and drive industry payment solutions. MAS seeks industry feedback on the proposed scope of the payments council, its composition, ownership and powers.

Jacqueline Loh, Deputy Managing Director of the Monetary Authority of Singapore (MAS). Image Credit: gettyimages

MAS Deputy Managing Director, Ms Jacqueline Loh said, “Payments is one of the key components of FinTech and serves as a foundation for our vision of a Smart Financial Centre. This public consultation is an important step for MAS and the payments industry to co-create the future of Singapore’s payments landscape; one where payments are swift, simple, and secure, supported by streamlined regulation and inclusive governance.”

The public consultation which will last from 25 August 2016 to 31 October 2016 and is the first in a series of consultations on the proposed regulatory framework and governance model for Singapore’s payments landscape. A copy of the public consultation paper is available on the MAS website.

Featured Image: From MAS website