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Exemption from requirement to hold standard payment institution licence

Payment Services Regulations 2019

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—(1) Subject to paragraph (2), a person who carries on a business of providing any one or more of the following payment services, and not any other payment service, is exempt from sections 5(1), 6(4) and 9(1) of the Act in respect of its business of providing that or those payment services, as the case may be:(a)an account issuance service;(b)a domestic money transfer service;(c)a cross‑border money transfer service;(d)a merchant acquisition service;(e)an e‑money issuance service.(2) The exemption under paragraph (1) is subject to —(a)where the person carries on a business of providing an account issuance service, all the following conditions:(i)the person is not exempt under regulation 3 of the Payment Services (Exemption for Specified Period) Regulations 2019;(ii)the person does not allow the withdrawal of any currency from any payment account it issues;(iii)the person only allows a refund of money that is more than $100 in currency (or its equivalent in a foreign currency) to any person from any payment account it issues, if —(A)an identification document of the holder of the payment account that bears a photograph of the holder and is in force is produced to the person; and(B)the person has in place a policy to keep a record of any refund and the relevant identification document mentioned in sub‑paragraph (A) for at least 5 years after the date on which the refund is made;(iv)the person does not allow the currency equivalent of e‑money or the amount of money contained in any payment account it issues to exceed $1,000 (or its equivalent in a foreign currency);(v)the person complies with sections 19 and 20(1) of the Act as if the person were a licensee mentioned in those provisions;(vi)but for paragraph (1), the person would be required to hold a standard payment institution licence under section 6(4) of the Act, but not a major payment institution licence under section 6(5) of the Act;(b)where the person carries on a business of providing a domestic money transfer service, all the following conditions:(i)the person is not exempt under regulation 4 of the Payment Services (Exemption for Specified Period) Regulations 2019;(ii)the business only involves one or more of the following types of transactions:(A)payment for goods or services where the payment is funded from an identifiable source;(B)payment for goods or services where the transaction value does not exceed $20,000 (or its equivalent in a foreign currency); (C)payment for any transaction (other than for goods or services) where the payment is funded from an identifiable source and the transaction value does not exceed $20,000 (or its equivalent in a foreign currency);(iii)the person complies with section 20(1) of the Act as if the person were a licensee mentioned in that provision;(iv)but for paragraph (1), the person would be required to hold a standard payment institution licence under section 6(4) of the Act, but not a major payment institution licence under section 6(5) of the Act;(c)where the person carries on a business of providing a cross‑border money transfer service, all the following conditions:(i)the person is —(A)not deemed to have been granted a licence under section 122(1), (4), (5) or (7) of the Act, or if the person was so deemed to have been granted a licence, the person has since ceased to hold the licence; and(B)not exempt under section 123(1) of the Act or regulation 29 of these Regulations or regulation 5 of the Payment Services (Exemption for Specified Period) Regulations 2019;(ii)the business only involves transactions that are used as payment for goods or services and are funded from identifiable sources;(iii)the person complies with section 20(1) of the Act as if the person were a licensee mentioned in that provision;(iv)but for paragraph (1), the person would be required to hold a standard payment institution licence under section 6(4) of the Act, but not a major payment institution licence under section 6(5) of the Act;(d)where the person carries on a business of providing a merchant acquisition service, all the following conditions:(i)the person is not exempt under regulation 4 of the Payment Services (Exemption for Specified Period) Regulations 2019;(ii)the person complies with section 20(1) of the Act as if the person were a licensee mentioned in that provision;(iii)but for paragraph (1), the person would be required to hold a standard payment institution licence under section 6(4) of the Act, but not a major payment institution licence under section 6(5) of the Act; or(e)where the person carries on a business of providing e‑money issuance service, all the following conditions:(i)the person is —(A)not deemed to have been granted a licence under section 122(3), (5), (6) or (7) of the Act, or if the person was so deemed to have been granted a licence, the person has since ceased to hold the licence; and(B)not exempt under section 123(3) of the Act or regulation 6 of the Payment Services (Exemption for Specified Period) Regulations 2019;(ii)the person complies with section 20(1) and (2) of the Act as if the person were a licensee mentioned in those provisions;(iii)but for paragraph (1), the person would be required to hold a standard payment institution licence under section 6(4) of the Act, but not a major payment institution licence under section 6(5) of the Act.(3) The exchange rate mentioned in paragraph (4) must be applied for determining the following:(a)for the purposes of paragraph (2)(a)(iii), whether an amount of money that is in foreign currency which is refunded by a person that issues a payment account from the payment account to the holder of the payment account exceeds $100;(b)for the purposes of paragraph (2)(b)(ii)(B), whether the value of a payment for goods or services executed by a person for a customer that is in foreign currency exceeds $20,000;(c)for the purposes of paragraph (2)(b)(ii)(C), whether the value of a payment which is executed by a person for a customer that is in foreign currency exceeds $20,000.(4) For the purposes of paragraph (3), the exchange rate is —(a)the exchange rate offered by the person to the customer for each refund or payment, as the case may be; or(b)where an exchange rate is not offered by the person to the customer — the applicable exchange rate that is published by any bank in Singapore on the date the refund is made, or the payment is executed.(5) For the purposes of determining whether the currency equivalent of e‑money or an amount of money contained in a payment account issued by a person that is in foreign currency exceeds $1,000 under paragraph (2)(a)(iv), the person must apply the applicable exchange rate that is published by any bank in Singapore on the date on which the determination is made.(6) A person mentioned in paragraph (1) must keep a record in the English language of all the exchange rates relied on by the person for the purposes of that paragraph for a period of at least 5 years.(7) In this regulation —“AML/CFT authority” has the meaning given by section 17(1) of the Financial Services and Markets Act 2022;“AML/CFT requirements” means requirements relating to anti‑money laundering and countering the financing of terrorism that are consistent with the standards set by the FATF;“FATF” means the Financial Action Task Force;“identifiable source” means —(a)an account that is maintained with a financial institution (whether or not incorporated or established in Singapore) which is subject to, and supervised by the Authority for compliance with AML/CFT requirements (including customer due diligence requirements) in respect of the account; or(b)an account that is maintained with a financial institution which is —(i)incorporated or established outside Singapore; and(ii)subject to, and supervised by an AML/CFT authority for compliance with, AML/CFT requirements (including customer due diligence requirements) in respect of the account.

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