15 January 2021
The Payment Services (Amendment) Bill (now "Act") has been passed in the Singapore Parliament after its Second Reading on Monday, 4 January. The Act aligns the Payment Services Act 2019 ("PS Act") with recommendations of the Financial Action Task Force, the international AML / CFT standards-setter. The amendments to the PS Act have not taken effect and will come into force on a date yet to be announced.
We have set out the amendments in further detail in our earlier client alert. Please see below for a summary of the key changes to the PS Act:
1. Expanded scope of digital payment token ("DPT") services
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The scope of DPT services has been broadened to include (amongst others) the following activities:
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Facilitating transfer of DPTs from one account to another;
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Providing custodial services for DPTs; and
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Facilitating the exchange of DPTs where the service provider does not come into possession of moneys or DPTs involved.
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Entities conducting any of the above activities will need to be regulated under the PS Act.
2. Expanded scope of cross-border money transfer services
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Cross-border money transfer services now include the facilitation of money transfers between persons in different jurisdictions, where money is not accepted by the entity in Singapore.
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Entities conducting the above will need to be regulated under the PS Act.
3. New MAS powers in respect of DPT service providers
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The MAS now has powers to:
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Impose user protection measures on DPT service providers when necessary (e.g. requiring an entity to safeguard or segregate customer assets from its own).
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Impose additional measures on DPT service providers to maintain stability in Singapore's financial system, safeguard the efficacy of Singapore's monetary policy, or in the public interest. The MAS will consult the industry before legislating these measures.
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4. Miscellaneous amendments
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Expanded scope of domestic money transfer services:
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Previously, the PS Act carved out from the scope of licensing domestic money transfer transactions where a financial institution was either a payer or payee.
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The PS Act will now carve out only situations where both payer and payee are financial institutions.
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The MAS now has powers to require the safeguarding of money (where necessary) by additional classes of licensees conducting specific payment services.
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Clarification that the general duty to use reasonable care not to provide false information to the MAS applies to all persons, and not just individuals.
For further information, please contact:
Peiying Chua Heikes, Linklaters
peiying.chua@linklaters.com
