Latest Payments News: Singaporean Regulator Shuns Calls For BNPL Ad Ban, But Says Finfluencers In Its Sights, and more

Catch up on some of the stories our payments compliance analysts have covered lately, and stay up-to-date on the latest news.

Singaporean Regulator Shuns Calls For BNPL Ad Ban, But Says Finfluencers In Its Sights

In fresh correspondence with the financial hubs' lawmakers, the Monetary Authority of Singapore (MAS) has continued not to bow to pressure to introduce stricter oversight of buy now, pay later (BNPL) firms, but did suggest that it is looking closely at consumer protection issues elsewhere.

Recently, Singapore’s financial regulator has faced continued scrutiny from parliamentarians about its approach to BNPL, which is being undertaken via guidance it agreed with the country’s fintech trade association.

For example, as covered by Vixio, the government faced a query in March regarding the rising use of BNPL among young consumers, and over breaches of the country’s guidelines for BNPL in February.

Now, it has faced another call, this time from the lawmaker Nadia Ahmad Samdin, who asked “whether the Government assesses a need to introduce stricter advertising guidelines for Buy Now, Pay Later (BNPL) schemes similar to the regulations for advertisement on gambling or high-risk financial products”.

According to the parliamentarian, this was in view of BNPL providers heavily marketing their services on social media and “often using influencers to promote instalment payments on discretionary spending such as fashion, travel, and entertainment to young consumers who may be particularly susceptible to these psychological nudges”.

However, MAS chair and deputy Prime Minister Gan Kim Yong played this issue down, and said that the government does not currently see a need for stricter advertising regulations for BNPL services, especially considering the industry-led code of conduct developed under the MAS’ oversight, which prohibits misleading or exaggerated advertising and requires full disclosure of fees and risks.

Bank Of England Considers Widening Access To RTGS Accounts

The Bank of England’s response to its February policy paper on extending direct access to its real-time gross settlement (RTGS) system suggests that expansion may be on the horizon for non-bank payment service providers and foreign banks alike.

The Bank of England is considering a significant expansion of access to its RTGS system, in bid to boost competition, innovation and resilience for the UK’s payments ecosystem.

Publishing its response to a February 2024 discussion paper, the central bank said there was strong industry support for its review of RTGS access.

Respondents broadly agreed with four key priority areas: enhancing the application process for non-bank payment service providers (NBPSPs); encouraging foreign bank access; clarifying entry requirements for financial market infrastructures (FMIs); and reviewing the CHAPS value threshold for direct participation.

Such an expansion would be very welcome news for the payments industry, in particular e-money institutions. For example, until now, many have relied on sponsor banks for indirect access to payment systems such as CHAPS, leaving them exposed to high fees, operational dependencies and shifting risk appetites.

In contrast, this policy change from the Bank of England would reduce reliance on traditional banks, give them greater control over settlement and open the door for more competitive offerings, especially for high-volume firms.

Brazil's Central Bank Targets Mobile Payment Giants With Proposed Tokenisation Rules

The Central Bank of Brazil (BCB) has targeted the growing influence of digital wallet giants such as Apple Pay and Google Pay, launching a public consultation on new rules governing card tokenisation services.

Stakeholders have until June 2, 2025 to respond to the tokenisation consultation, as the central bank seeks input from the public and financial services sector on how best to regulate companies that request and store payment instrument data tokens, a role fulfilled by digital wallet services including Apple Pay, Google Pay and Samsung Pay.

These “token requesters” act as intermediaries between card issuers and merchants, generating and storing secure tokens that stand in for a user's card credentials during transactions.

The process has long underpinned the security and convenience of smartphone-based card payments. However, the BCB is concerned that the rapid adoption of these services has created new imbalances in the payments ecosystem.

“The regulator's concern arises because token applicants have gained significant market power over issuers due to these services being embedded in smartphones, which, due to the convenience offered to users, have become an essential tool in the way consumers and merchants interact in payment transactions,” the consultation says.

Brazil has experienced explosive growth in digital payments in recent years, with card transactions surging from 7.2bn in Q3 2020 to more than 12.3bn in Q3 2024, with such widespread use of smartphones and mobile wallets making tokenisation a core component of the payment process, and granting international companies such as Apple, Google and Samsung considerable leverage, according to the BCB.

SEC Paves Way For US Payments Innovation Opportunities With Stablecoin Clarity

The US Securities and Exchange Commission (SEC) has clarified its stance on certain US dollar-backed stablecoins, stating that their offer and sale do not constitute securities transactions under federal law, so long as they meet specific criteria.

In a statement issued by the Division of Corporation Finance, the SEC outlined its view that “Covered Stablecoins”, crypto-assets pegged 1:1 to the US dollar and fully backed by low-risk, highly liquid reserves, fall outside the definitions of a “security” as defined under the Securities Act of 1933 and the Securities Exchange Act of 1934.

“Covered Stablecoins are crypto assets designed and marketed for use as a means of making payments, transmitting money, or storing value,” the statement said. “They are designed to maintain a stable value relative to USD and are backed by USD and/or other assets that are considered low-risk and readily liquid so as to allow a Covered Stablecoin issuer to honor redemptions on demand.”

The guidance released by the US federal regulator applies to stablecoins redeemable at a fixed rate of one stablecoin to one US dollar and are fully backed by reserves composed of US dollars and/or other low-risk, highly liquid assets.

According to the SEC, these stablecoins must be structured to allow for unlimited minting and redemption at a fixed price, with the issuer ready to exchange them for USD on a one-to-one basis at any time.

The SEC emphasised that these stablecoins are not marketed as investment opportunities or vehicles for profit.

Instead, they are commonly referred to as “digital dollars” and are intended for use in payments, money transfers or as a store of value.

Due to this, they do not provide holders with rights to interest, profits, ownership or governance, and typically, these stablecoins are issued by entities that can redeem them at par value, either directly or through designated intermediaries.

Scammers Exploiting Chinese Payment Platforms, Singapore Warns

In the latest move to crack down on payments scams, the Singapore Police Force (SPF) and Monetary Authority of Singapore (MAS) issued a warning on Friday (April 4) about the use of payment platforms to defraud people of their money.

It highlighted the use of Chinese messaging and payment platforms, such as WeChat, UnionPay or Alipay and urged the public to be vigilant.

At least 678 impersonation scams worth at least S$17.4m ($12.91m) had been reported since January, it said.

According to the MAS, recent scams saw victims receiving unsolicited calls for local mobile numbers impersonating the Chinese platforms.

The scammer would tell victims a subscription to which they had signed up, such as for insurance coverage, was about to expire and direct them to continue the conversation on WhatsApp, the MAS said.

It said the scammer would tell victims that fees would be automatically taken from the bank accounts they had linked to the platforms unless they cancelled their subscriptions, but to do so they had to verify their identities by providing personal information.

Victims would also be told to verify their bank accounts by making bank transfers to a given bank account and in some cases would be guided to perform the transfers on the WhatsApp screen sharing function. The scammers would tell the victims their monies would be refunded upon cancellation of their subscriptions, the MAS said.

It said scammers used a range of tactics to bolster their credibility, including sending victims fake documents or having a second scammer impersonate a MAS officer who would tell them they had been implicated in money laundering activities.

Victims only realised they had been scammed when the scammers became uncontactable or they did not receive the promised refunds, the MAS said.

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