SINGAPORE Law and Practice Contributed by: Kenneth Pereire and Lin YingXin, KGP Legal LLC
5. Payment Processors 5.1 Payment Processors’ Use of Payment Rails Payment services, including processing, are regu - lated by the MAS under the PSA. Payment services are categorised by PSA, but it is the providing of the payment service that is regulated, and not the creation or implementation of new payment rails. 5.2 Regulation of Cross-Border Payments and Remittances Cross-border payments and remittance services are regulated under the PSA and administered by the MAS. Cross-border payment services in Singapore must be licensed by MAS to ensure that service pro - viders meet legal requirements, implement robust AML/CTFT measures, carry out transaction monitor - ing, and meet regulatory standards on practices such as risk management. Additionally, the PSA is aimed at protecting consumers engaging in cross-border trans - actions. Thus, service providers must inform consum - ers of related fees, exchange rates, and terms and conditions in a clear manner. 6. Marketplaces, Exchanges and Trading Platforms 6.1 Permissible Trading Platforms There are various types of marketplaces and trad - ing platforms that are permissible in Singapore. MAS oversees these platforms to ensure market integrity, investor protection and regulatory compliance across the financial ecosystem. Traditional Stock Exchanges • Example – SGX. • Regulatory regime – traditional stock exchanges are regulated by the MAS and must adhere to the SFA and the rules and regulations set forth by MAS and SGX. These regulations govern aspects such as listing requirements, trading rules, market con - duct and investor protection. Multilateral Trading Facilities (MTFs) • Example – SGX Bond Pro.
• Regulatory regime – MTFs are alternative trad - ing venues that facilitate the trading of securities outside of traditional stock exchanges. They are subject to regulations similar to traditional stock exchanges, including compliance with the SFA and MAS regulations. However, MTFs may have slightly different listing requirements and trading rules tai -
lored to their specific market segments. Peer-to-Peer (P2P) Trading Platforms • Example – Funding Societies.
• Regulatory regime – P2P trading platforms facili - tate direct transactions between buyers and sellers without the involvement of traditional intermediar- ies. They are regulated by MAS under the SFA if they offer securities and FAA if they provide finan - cial advice. MAS imposes licensing requirements, conduct standards and disclosure obligations on P2P trading platforms to safeguard investor interests, ensure market integrity, and mitigate risks associated with peer-to-peer lending. Digital Asset Exchanges • Examples – Gemini, Coinhako, Kraken. • Regulatory regime – cryptocurrency exchanges facilitate the trading of digital assets such as Bitcoin and Ethereum. They are regulated by MAS under the PSA if they facilitate the exchange of digital payment tokens. Such cryptocurrency exchanges are required to obtain a licence from MAS to operate legally in Singapore. The PSA imposes stringent requirements on regulated cryp - tocurrency exchanges, including AML/CTF meas - ures, customer due diligence, and cybersecurity standards. 6.2 Regulation of Different Asset Classes In Singapore, different asset classes are regulated under the MAS framework, which includes AML/CFT rules to ensure financial system integrity. Asset classes are subject to tailored regulatory regimes. Capital markets products, such as shares and debentures, are regulated under the SFA, depend - ing on the activity and applicable exemptions. Digital payment tokens (cryptocurrencies) and e-money are regulated under the PSA, depending on the activity conducted.
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