MAS Expands Regulation with Protection for Digital Payment Tokens
The Monetary Authority of Singapore (MAS) announced amendments to the Payment Services Act (PS Act) and its subsidiary legislation to broaden the range of payment services under MAS regulation. The amendments also introduce user protection and financial stability requirements for digital payment token (DPT) service providers. These changes will be implemented in stages starting from April 4, 2024.
The amendments will expand the scope of regulation under the PS Act to include the following activities:
- Providing custodial services for digital payment tokens (DPTs);
- Facilitating the transmission of DPTs between accounts and the exchange of DPTs, even if the service provider does not handle the funds or DPTs directly; and
- Facilitating cross-border money transfers between different countries, even if the funds are not accepted or received in Singapore.
The amendments will empower MAS to impose requirements on digital payment token (DPT) service providers related to anti-money laundering and countering the financing of terrorism, user protection, and financial stability.
Transitional arrangements will be provided for entities currently conducting activities under the expanded scope of the PS Act. Entities that do not meet the MAS requirements must cease their activities when the amendments take effect.
The amended Payment Services Regulations on safeguarding customer assets for digital payment token (DPT) service providers take effect six months from April 4, 2024.
