SINGAPORE: A new Payment Services Act that will strengthen consumer protection and promote confidence in the use of e-payments came into force on Tuesday (Jan 28), the Monetary Authority of Singapore (MAS) announced.
The Act adopts a licensing framework that recognises different activities and new developments in payment services, as well as expands MAS' regulatory ambit to include payment services such as digital payment token services.
The Money-changing and Remittance Businesses Act and the Payment Systems (Oversight) Act, enacted in 1979 and 2006 respectively, will be repealed with the commencement of the Payment Services Act.
With the payment services landscape changing considerably over the past few years, new risks have sprung up from activities that fall beyond the scope of the previous regulatory regime, MAS said in previous press releases.
New payment business models have also blurred the lines between activities regulated under the previous two Acts.
“The Payment Services Act provides a forward-looking and flexible regulatory framework for the payments industry," MAS assistant managing director for policy, payments and financial crime Loo Siew Yee said on Tuesday.
"The activity-based and risk-focused regulatory structure allows rules to be applied proportionately and to be robust to changing business models. The Payment Services Act will facilitate growth and innovation while mitigating risk and fostering confidence in our payments landscape."
Four key risks will be targeted by the new legislation: Loss of customers' money, money laundering or terrorist financing risks, fragmentation and lack of interoperability across payment solutions, and technology risks, including cyber risks.
These were outlined in January 2019 at the second reading of the Payment Services Bill in Parliament by Minister for Education Ong Ye Kung, on behalf of then deputy prime minister Tharman Shanmugaratnam.
"The Bill is a necessary piece in Singapore’s Smart Nation journey. It will help us build a technologically robust smart financial centre, that preserves stability while facilitating innovation and growth in the payments landscape," Mr Ong had said.