Implementation of the Payment Systems (Oversight) Act 2006
Singapore, 22 June 2006... The Monetary Authority of Singapore (MAS) announced today that the Payment Systems (Oversight) Act 2006
will take effect on 23 June 2006. The PS(O)A provides a comprehensive framework for MAS to oversee payment systems and stored value facilities (SVF) in Singapore. The Act was passed in Parliament on 16 January 2006.
2 MAS will also be issuing regulations pursuant to the PS(O)A, and a set of guidelines on SVF. The regulations specify operational requirements for payment system operators, settlement institutions and participants, while the guidelines set out broad principles on the sound practices and risk mitigation measures for SVF schemes. MAS had consulted the industry on these regulations and guidelines, and had incorporated the feedback received, where appropriate. Our responses to the consultations are published on the MAS website.
The PS(O)A gives MAS the discretionary power to gather information from operators and settlement institutions of, and participants in any payment system in Singapore. The Act also allows MAS to designate payment systems that are considered important for financial stability or for public confidence. Operators and settlement institutions of, as well as participants in designated payment systems will be subject to MAS' regulation.
Stored Value Facilities (SVFs)
SVFs refer to prepaid cards and other payment instruments used for the purchase of goods and services. SVFs can be categorized as either single-purpose or multi-purpose. Only banks are allowed to issue multi-purpose SVFs presently. PS(O)A introduces a new regulatory regime that liberalises the multi-purpose SVF market. Under the new regime, multi-purpose SVFs with stored values below S$30 million and single-purpose SVFs may be issued by any entity. Such SVFs do not require the approval of MAS. MAS may gather information from any SVF issuer at any time and impose disclosure requirements on market players to enable consumers to discern the risks relating to different SVFs.