The Monetary Authority of Singapore (MAS) announced on Tuesday the commencement of the Payment Services Act (PSA), thus updating the regulatory framework for digital payments.
The regulatory framework will “strengthen consumer protection and promote confidence,” per the regulator.
Though passed by Singapore’s legislators in January 2019, it took one year by the country to enforce the new laws.
The framework will apply to a wide range of digital payments businesses, including “new types of payment services, such as digital payment token services,” meaning all crypto businesses ad exchanges also need to comply with the new regulations.
Commenting on the new regulations, Loo Siew Yee, assistant managing director at MAS, said: “The Payment Services Act provides a forward-looking and flexible regulatory framework for the payments industry. The activity-based and risk-focused regulatory structure allows rules to be applied proportionately and to be robust to changing business models.”
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The regulator has provided all digital payments businesses operating within the city-state one month’s time to register with it. They will be provided with a further six month period to apply for a payment institution license.
“The PS Act will facilitate growth and innovation while mitigating risk and fostering confidence in our payments landscape,” Yee added.
Creating a safe haven for payments businesses
Singapore is one of the favorable jurisdictions in Asia for crypto and other digital payments businesses. The government is also boosting the industry by bringing favorable regulations.
Last November, Finance Magnates reported that the financial regulator was working to allow derivatives trading of digital currencies on approved exchanges under its jurisdiction.
Meanwhile, in Europe, the Fifth European Anti-Money Laundering Directive (AMLD5) has been enforced on January 10. Its impact, however, is turning to be negative on crypto businesses as multiple exchanges are moving from the continent to much friendlier jurisdictions.