Licensing for Payment Service Providers
Payment service providers are licensed to provide specified payment services under the Payment Services Act 2019 ("PS Act").
Types of Payment Services
MAS regulates 7 types of payment services under the Payment Services Act (PS Act). Payment service providers must hold a licence to provide these payment services in Singapore, unless exempted:
Type of Payment Services | Brief Description |
Account issuance service | Issuing a payment account, or any service relating to any operation required for operating such accounts. Examples include electronic wallets (e-wallets) or a stored-value card that can be used to pay at various merchants or to transfer funds to other parties. |
Domestic money transfer service | Providing local funds transfer service in Singapore, which could include payment gateway services and payment kiosk services. |
Cross-border money transfer service | Providing inbound or outbound remittance service in Singapore, as well as facilitating remittance between entities in different countries even if monies are not accepted or received in Singapore. |
Merchant acquisition service | Providing the service of accepting and processing payment transactions for a merchant under a contract. This service usually includes the provision of a point-of-sale terminal or online payment gateway. Merchant acquirers may also be providing a money transfer service if they facilitate the transfer of funds. |
E-money issuance service | Issuing e-money, which can be used for payment or fund transfers. |
Digital payment token service |
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Money-changing service | Buying or selling foreign currency notes. |
You may refer to Part 2 of the First Schedule of the PS Act for more information on services that are not regulated payment services under the PS Act.
Payment service providers can apply for 3 types of licences to provide payment services regulated under the Payment Services Act 2019 (“PS Act”).
Types of Licences
Standard Payment Institution Licence (SPI)
Major Payment Institution Licence (MPI)
Money-Changing Licence
Standard Payment Institution Licence (SPI)
You can apply for a standard payment institution (SPI) licence if your payment services meet the following thresholds:
S$3 million monthly transactions for any payment service (other than e-money account issuance and money-changing services).
S$6 million monthly transactions for two or more payment services (other than e-money account issuance and money-changing services).
S$5 million of daily outstanding electronic money (e-money).
Refer to:
Section 6(5) of the PS Act for more information on the threshold limits.
Eligibility Criteria
If you are applying for an SPI licence, you must meet all of the following criteria:
Be a Singapore-incorporated company or a Singapore branch of a foreign corporation.
Have a permanent place of business or a registered office where the books and records can be securely held.
At least one person must be appointed to be present at the place of business or a registered office to address any queries or complaints from consumers.
Have a minimum base capital of S$100,000.
You must have sufficient capital buffer in excess of the base capital requirement, bearing in mind the scale and scope of its operations and the potential for profit and losses.
Should have either 1 executive director who is a Singapore Citizen or Singapore Permanent Resident (PR), or 1 executive director who is a Singapore Employment Pass (EP) holder and at least 1 other director who is a Singapore citizen or Singapore PR.
Assessment Criteria
When assessing an application for an SPI licence, MAS takes into consideration (but not limited to) the following factors:
Factor | What it Entails |
Fitness and propriety | Your controllers and directors must be fit and proper, in accordance with the Guidelines on Fit and Proper Criteria [FSG-G01]. |
Competency of key individuals | You should have sufficient experience in operating a business in the payment services industry or related areas in the financial services industry. |
Compliance arrangements | You must have in place plans for compliance arrangements that correspond with the business's nature, scale and complexity. Refer to Appendix 2 of the Guidelines on Licensing for Payment Service Providers (433.7 KB) for the minimum requirements for compliance arrangements. |
Technology risk management | If you intend to provide online financial services, you must perform a penetration test of the proposed online financial services. All high-risk findings identified must then be remediated, and an independent validation on the effectiveness of the remediation actions must be completed before the licence is granted. |
Audit arrangements | You must have in place plans for adequate independent audit arrangements that correspond with the nature, scale and complexity of the business. |
Annual audit requirements | You must have in place plans to meet the annual audit requirements as mentioned in Section 37 of the PS Act . The auditor must be appointed at your own expense to audit the entity's accounts and transactions, and compliance with the relevant regulations and requirements. |
Letter of Responsibility and Letter of Undertaking | MAS may require you to obtain a Letter of Responsibility or a Letter of Undertaking from the entity's majority shareholders, parent company and related company, where appropriate. |
MAS may also take into consideration:
Your track record and financial condition, as well as those of your holding company or related corporations, where applicable.
Your operational readiness, including your ability to comply with regulatory requirements.
Your holding company's commitment to conduct operations in Singapore.
Whether you, your holding company or related corporations are subject to proper supervision by a competent regulatory authority.
Whether the public interest will be served by granting a licence.
Refer to the Guidelines on Licensing for Payment Service Providers for more details on the eligibility and assessment criteria.
Major Payment Institution Licence (MPI)
Under a major payment institution (MPI) licence, you can conduct multiple payment services without being subjected to the following threshold limits on transaction volume or float :
S$3 million monthly transactions for any payment service (other than electronic money (e-money) account issuance and money-changing services).
S$6 million monthly transactions for two or more payment services (other than e-money account issuance and money-changing services).
S$5 million of daily outstanding e-money.
Refer to:
Section 6(5) of the PS Act for more information on the threshold limits.
Eligibility Criteria
If you are applying for an MPI licence, you must meet all of the following criteria:
Be a Singapore-incorporated company or a Singapore branch of a foreign corporation.
Have a permanent place of business or a registered office where the books and records can be securely held.
At least one person must be appointed to be present at the place of business or a registered office to address any queries or complaints from consumers.
Have a minimum base capital of S$250,000.
You must have sufficient capital buffer in excess of the base capital requirement, bearing in mind the scale and scope of its operations and the potential for profit and losses.
Should have either 1 executive director who is a Singapore Citizen or Singapore Permanent Resident (PR), or 1 executive director who is a Singapore Employment Pass (EP) holder and at least 1 other director who is a Singapore citizen or Singapore PR.
Assessment Criteria
When assessing an application for an MPI licence, MAS takes into consideration (but not limited to) the following factors:
Factor | What it Entails |
Fitness and propriety | Your controllers and directors must be fit and proper, in accordance with the Guidelines on Fit and Proper Criteria [FSG-G01]. |
Competency of key individuals | You should have sufficient experience in operating a business in the payment services industry or related areas in the financial services industry. |
Security | You must provide the following security prior to starting business:
The security must be made in the form of a cash deposit with MAS or a bank guarantee. |
Compliance arrangements | You must have in place plans for compliance arrangements that correspond with the business's nature, scale and complexity. Refer to Appendix 2 of the Guidelines on Licensing for Payment Service Providers (433.7 KB) for the minimum requirements for compliance arrangements. |
Technology risk management | If you intend to provide online financial services, you must perform a penetration test of the proposed online financial services. All high-risk findings identified must then be remediated, and an independent validation on the effectiveness of the remediation actions must be completed before the licence is granted. |
Audit arrangements | You must have in place plans for adequate independent audit arrangements that correspond with the nature, scale and complexity of the business. |
Annual audit requirements | You must have in place plans to meet the annual audit requirements as mentioned in Section 37 of the PS Act. The auditor must be appointed at your own expense to audit the entity's accounts and transactions, and compliance with the relevant regulations and requirements. |
Letter of Responsibility and Letter of Undertaking | MAS may require you to obtain a Letter of Responsibility or a Letter of Undertaking from the entity's majority shareholders, parent company and related company, where appropriate. |
MAS may also take into consideration:
Your track record and financial condition, as well as those of your holding company or related corporations, where applicable.
Your operational readiness, including your ability to comply with regulatory requirements.
Your holding company's commitment to conduct operations in Singapore.
Whether you, your holding company or related corporations are subject to proper supervision by a competent regulatory authority.
Whether the public interest will be served by granting a licence.
Refer to the Guidelines on Licensing for Payment Service Providers for more details on the eligibility and assessment criteria.
Money-Changing Licence
If you provide money-changing service (for example, the service of buying or selling foreign currency notes), you will have to apply for a money-changing licence.
Eligibility Criteria
You may apply for a money-changing licence if all of the following criteria are met:
Entity type | Governance or ownership requirements |
A sole proprietorship |
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A partnership or limited liability partnership (LLP) |
|
Singapore-owned company |
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Singapore incorporated wholly-owned subsidiary of a foreign bank, or a foreign company primarily engaged in money-changing |
|
Assessment Criteria
When assessing an application for a money-changing licence, MAS takes into consideration (but not limited to) the following factors:
Factor | What it Entails |
Fitness and propriety |
|
Competency of key individuals | You must ensure that the entity's sole proprietor, partners, or executive directors and CEO have:
|
Permanent place of business or registered office | You must have a permanent place of business or a registered office where the books and records can be securely held.At least one person must be appointed to be present at the place of business or a registered office to address any queries or complaints from consumers. |
Compliance arrangements | You must have in place plans for compliance arrangements that correspond with the business's nature, scale and complexity. Refer to Appendix 2 of the Guidelines on Licensing for Payment Service Providers (433.7 KB) for the minimum requirements for compliance arrangements. |
Audit arrangements | You must have in place plans for adequate independent audit arrangements that correspond with the nature, scale and complexity of the business. |
Annual audit requirements | You must have in place plans to meet the annual audit requirements as mentioned in Section 37 of the PS Act. The auditor must be appointed at your own expense to audit the entity's accounts and transactions, and compliance with the relevant regulations and requirements. |
Letter of Responsibility and Letter of Undertaking | MAS may require you to obtain a Letter of Responsibility or a Letter of Undertaking from the entity's majority shareholders, parent company and related company, where appropriate. |
MAS may also take into consideration:
The track record and financial condition of the entity, its holding company or related corporations, where applicable.
The entity's operational readiness, including the ability to comply with regulatory requirements.
The commitment of the entity's holding company to conduct operations in Singapore.
Whether the entity, its holding company or related corporations are subject to proper supervision by a competent regulatory authority.
Whether the public interest will be served by granting a licence.
Refer to the Guidelines on Licensing for Payment Service Providers for more details on the eligibility and assessment criteria.
General information on the licensing criteria under the Payment Services Act 2019 (“PS Act”)
Apply for Standard payment institution (SPI) licence
1. The option which best describes your business set-up:
A Singapore-incorporated company
Singapore branch of the foreign corporation
2. You are required to have a permanent place of business or registered office in Singapore to be eligible for a standard payment institution or a major payment institution licence. It must be an office area where the applicant’s books and records can be securely held. You must also appoint at least one person to be present to address any queries or complaints from customers.
3. At least one of your executive directors must be a Singapore citizen or permanent resident. Alternatively, if your executive director is a Singapore Employment Pass holder, at least one other director must be a Singapore citizen or permanent resident.
4. All your directors, partners, CEO and 20% controllers must meet the fit and proper criteria as set out in the Guidelines on Fit and Proper Criteria.
A 20% controller is a person who, alone or together with the person’s associates, has an interest in at least 20% of the shares in the corporation or can control at least 20% of the votes in the corporation.
There should not be any adverse reputation surrounding the entity or the group, particularly with regard to financial crime.
5. Your company must have a base capital of at least $100,000 to be eligible for a standard payment institution licence. You must also ensure that a sufficient capital buffer in excess of the base capital requirement is maintained, bearing in mind the scale and scope of its operations and the potential for profit and losses. As a general rule of thumb, the capital buffer should be able to cover 6 to 12 months of your company's operations.
Base capital is the sum of
(a) all of the following items in the latest accounts of the company:
(i) paid-up ordinary share capital;
(ii) paid-up irredeemable and non-cumulative preference share capital;
and
(b) any unappropriated profit or loss in the latest audited accounts of the company, less — (c) any interim loss in the latest accounts of the company; and
(d) any dividend that has been declared since the latest audited accounts of the company.
6. To be eligible for a licence, you should have adequate compliance arrangements that are commensurate with the scale, nature and complexity of your operations, as well as a compliance officer who is suitably qualified at the management level.
You can refer to the Guidelines on Licensing for Payment Service Providers for more information on the minimum compliance arrangements.
Have a compliance arrangement in place, including a compliance officer.
. You are expected to have the following policies, procedures and systems in place to comply with the licensing requirements:
Anti-money laundering and countering the financing of terrorism, taking into account, where applicable, the requirements and guidance under MAS Notices PSN01, PSN02, PSN03 and their accompanying guidelines.
Cyber security, taking into account requirements under MAS Notice PSN06.
Management of technology risk as set out in the MAS Guidelines on Technology Risk Management.
Complaints-handling and other conduct requirements, including, where applicable, the requirements under MAS Notice PSN07: Notice on Conduct and PSN08: Notice on Disclosures and Communications.
Regulatory reporting, including, where applicable, the requirements under MAS Notice PSN04: Notice on Submission of Regulatory Returns.
Notice on Technology Risk Management (FSM-N13) - requirements on technology risk management for holders of payment services licence (digital payment token service) with effect from 6 November 2024, where applicable.
Safeguarding and segregation requirements for DPT service providers in respect of customers’ assets as set out in Payment Services (Amendment) Regulations 2024 and the relevant Guidelines, where applicable.
Find out more about the requirements from the PS Act as well as the Payment Services Regulations, Guidelines on Licensing for Payment Service Providers, FAQs and other PS Act publications.
How to Apply
Before you apply for a payment service provider licence, you should:
Find out if the payment service you are providing is regulated under the Payment Services Act 2019 ("PS Act").
Find out about the different types of licences and their respective eligibility and assessment criteria.
Refer to the PS Act, the Payment Service Regulations, the Guidelines on Licensing for Payment Services Providers, and the relevant notices and guidelines to determine whether you meet the requirements for the respective licence you are applying for.
Refer to the FAQ for clarifications on some of the commonly asked questions about the PS Act.
Apply for a Licence
Once you have determined the type of licence required for your business, please submit the application online . For assistance, please refer to the Help section.
What You Will Need
You should prepare the following documents according to the application checklist before you apply:
A copy of your business profile as filed with the Accounting and Corporate Regulatory Authority (ACRA) of Singapore.
The document should be dated within 30 days of the date of application.
Scanned copies of your audited financial statements and the audited consolidated financial statements of the group for the past 3 years, where applicable.
If you or the group has yet to undergo an independent audit, you will have to attach the unaudited financial statements.
A copy of your organisation chart, including the compliance function.
A copy of your shareholding chart, including all controlling interests.
Your business plan that illustrates compliance with the PS Act as well as other relevant legislation.
A legal opinion on the regulated payment services conducted given your proposed business model. The legal opinion should be issued by a law firm that has experience advising on the PS Act in Singapore and should include a detailed and comprehensive analysis of how each regulated payment service is or is not applicable to each proposed service or product.
Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) policies & procedures, enterprise-wide risk assessment and implementation plans that illustrate your compliance with the relevant Notices on Prevention of Money Laundering and Countering the Financing of Terrorism [PSN01] and [PSN02]
You should include the name and curriculum vitae (CV) of the AML/CFT compliance officer (if different from the designated compliance officer).
For new applicants applying to provide a Digital Payment Token Service, an independent external auditor’s assessment report on the new applicant’s proposed AML/CFT and Consumer Protection processes, policies and procedures is required. The External Auditor’s independent assessment report should be submitted together with the applicant’s licence application and must have been issued and signed off by the External Auditor within the last 3 months from the date of application submission.
If you have corporate entities as shareholders: A copy of each shareholder's business profile dated within 30 days of the date of application.
If you have individuals as shareholders: Clear copy (both front and back) of Employment Pass/passport of the shareholder(s), if the individual is not a Singapore citizen or permanent resident.
If you are applying on behalf of a partnership, Singapore company, or corporations formed or incorporated outside Singapore: A copy of [Form 3] for each partner, director and Chief Executive Officer (CEO) with the required supporting documents.
If you are applying on behalf of a sole proprietorship: Supporting documents to demonstrate the sole proprietor's experience in payment services such as (but is not limited to) the latest CV of the sole proprietor.
You will also have to provide a copy of the the sole proprietor's Medisave liabilities and payment status. (Please use the CPF e-Service to check the status and provide a screenshot.)
If you are applying on behalf of a hotel: A copy of the hotel licence.
Application Fees
You are required to pay a non-refundable application fee. The amount of application fees you will have to pay depends on the payment services you are applying for.
The application fees are, in summary:
For a money-changing licence, S$500.
For a standard payment institution, S$1,000 or the sum of the amounts below for the payment services applied for, whichever is higher.
For a major payment institution, S$1,500 or the sum of the amounts below for the payment services applied for, whichever is higher.
Activity Type | Standard Payment Institution | Major Payment Institution |
Account issuance service | S$0 | S$0 |
Domestic money transfer service | S$1,000 | S$1,500 |
Cross-border money transfer service | S$1,000 | S$1,500 |
Merchant acquisition service | S$1,000 | S$1,500 |
E-money issuance service | S$1,000 | S$1,500 |
Digital payment token service | S$1,000 | S$1,500 |
Money-changing service | S$500 | S$500 |
Refer to the Schedule of the Payment Service Regulations (PSR) for more information about the fees.
Licence Issuance
Once your licence application is approved, MAS will inform you and issue your e-licence via email.
You may also refer to the FAQs on the Payment Service Act for more information on the scope of payment services.
How Bestar can Help
Bestar can provide invaluable assistance to payment service providers (PSPs) seeking licensing in Singapore. Here are some key ways we can help:
1. Regulatory Compliance:
Understanding of the Payment Services Act (PSA): Bestar can provide comprehensive guidance on the PSA and its regulations, ensuring that PSPs adhere to all applicable legal requirements.
Drafting of Application Documents: We can assist in preparing accurate and well-structured application documents, including business plans, risk management policies, and compliance frameworks.
Legal Opinions: Bestar's partnered legal firms can provide legal opinions that are essential for the licensing process, demonstrating that the PSP's business model and operations comply with the PSA.
2. Due Diligence:
Background Checks: Bestar can conduct thorough background checks on key individuals involved in the PSP's operations, ensuring that they meet the fit and proper criteria set by the Monetary Authority of Singapore (MAS).
Risk Assessments: We can assist in identifying and assessing potential risks associated with the PSP's business, helping to develop effective risk management strategies.
3. Ongoing Compliance:
Regulatory Updates: Bestar can keep PSPs informed about changes in regulations and industry best practices, ensuring that they remain compliant with evolving requirements.
Internal Audits: We can help conduct internal audits to assess the PSP's compliance with regulatory standards and identify areas for improvement.
4. Tailored Advice:
Business Model Analysis: Bestar can analyze the PSP's business model and provide tailored advice on how to structure its operations to comply with regulatory requirements.
Strategic Planning: We can assist in developing strategic plans that align with the PSP's long-term goals and address potential regulatory challenges.
By engaging Bestar, PSPs can significantly increase their chances of obtaining a license and ensuring ongoing compliance with Singapore's regulatory framework.
Licensing for Payment Service Providers: A Specialist Legal Opinion required
Singapore's Guidelines on Licensing for Payment Service Providers
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