Singapore (VNA) – Singapore’s parliament on January 14 passed a law on paymentservices, including regulations on digital payment to bolster the country’scashless payments.

Under thePayment Services Act, which is scheduled to take effect later this year, payment-serviceproviders that exceed a monthly average of 3 million SGD (2.2 million USD) intransactions, or 5 million SGD (3.7 million USD) in electronic money in theirdaily float (in a calendar year), will have to be licensed as majorpayment institutions.

These providerswill require a guarantee by any bank in Singapore to be fully liable fortheir customers’ money, have a deposit in a trust account, or engage in other safeguardsas prescribed by the Monetary Authority of Singapore (MAS).

Payment-service providerswhich do not go above the threshold will be licensed as standard paymentinstitutions. They are not required to adopt such safeguarding measures ofcustomers’ monies under the new law, but will be required to tell customers so.

This is to ensure that the measures will not be too onerous orstifling for businesses, said Singaporean EducationMinister Ong Ye Kung Ong, who is also a MAS board member.

Under the new law, Singaporean residents will not be able towithdraw Singapore dollars from the electronic money accounts. This is topromote greater adoption of cashless payments.

Personal accounts cannot exceed 5,000 SGD (3,700 USD) at any time andthe total amount of payments made from the account in a year cannot exceed 30,000SGD (22,100 USD), excluding transfers to the user’s designated bank accounts.

These caps do not apply to merchant payment accounts for businessuses.

The Payment Services Actrequires companies dealing in cryptocurrencies or digital payment tokens tomeet requirements in the fight against money laundering and terrorismfinancing.–VNA