The Monetary Authority of Singapore (MAS) has today published the final installment of its responses to comments received on its proposed regulations for Digital Discretionary Payment (DPT) service providers in Singapore.
The proposals considered detail business conduct and consumer access measures to limit potential consumer harm. It also sets minimum technology and cyber risk management requirements for DPT service providers.
In terms of business conduct, MAS will issue guidance for DPT service providers to implement these measures, which received broad support from a wide range of respondents:
- Identifying, mitigating and clearly disclosing potential and actual conflicts of interest;
- Publication of policies, procedures and criteria governing the registration of a DPT. and
- Establish effective policies and procedures for handling customer complaints and resolving disputes.
In terms of consumer access measures, DPT service providers should discourage cryptocurrency speculation by retail customers by:
- Determining the client’s risk awareness for accessing DPT services.
- It does not offer any incentive to trade in cryptocurrencies.
- It does not provide financing, margin or leveraged trading.
- Not accepting local credit card payments. and
- Limiting the value of cryptocurrencies in determining a customer’s net worth.
In the area of technology and cyber risks, MAS will require DPT service providers to maintain high availability and recoverability of their critical systems, in line with current requirements imposed on financial institutions.
MAS regulatory measures for DPT services will be implemented through regulations and guidelines, which will come into effect gradually from mid-2024. This will provide a sufficient transition period for DPT service providers to properly implement these measures.
Ms Ho Hern Shin, Deputy Managing Director (Financial Supervision), MAS, said:
“DPT service providers have an obligation to protect the interests of consumers who interact with their platforms and use their services. While these measures of business conduct and consumer access can help achieve this goal, they cannot insulate customers from losses associated with the inherently speculative and highly risky nature of cryptocurrency trading.
We urge consumers to remain vigilant and take extra care when dealing with DPT services and not to deal with unregulated entities, including those based overseas.”