President Ratifies Amendment Empowering MMA to Establish National Payment Switch
- President Muizzu ratified the second amendment to the National Payment System Act, empowering the MMA to designate a national payment switch.
- Banks and payment service providers, local and overseas, must route MMA-covered transactions through the designated switch within a set timeframe.
- New rules require payment acquiring providers to deposit customer funds in a licensed bank by the next business day and deliver funds within one day.
President Dr Mohamed Muizzu has ratified the second amendment to the National Payment System Act, giving the Maldives Monetary Authority (MMA) powers to designate a system as the country’s national payment switch.
The amendment to Act No. 8/2021 was passed by Parliament on Monday, August 17.
Under the amended law, the MMA can designate a system within the Maldivian National Payment System as the national payment switch. Banks and payment service providers operating in the Maldives and overseas will be required to route transactions covered by MMA regulations through the designated system.
The amendment requires banks and payment service providers to complete the necessary steps to participate in the national payment switch within a timeframe set by the MMA. The authority can also establish transitional arrangements to ensure existing services continue without interruption while providers join the system.
The MMA will also have the power to issue regulations, principles and guidelines governing participation in the national payment switch, including technical standards, reporting requirements, fees and procedures for developing and operating the system.
If the designated switch is operated by an entity licensed by the MMA rather than the authority itself, the system and its operator will be subject to relevant requirements under the National Payment System Act.
The amendment also introduces additional requirements for licensed payment service providers offering payment acquiring services.
Under the new provisions, such providers must deposit customer funds into an account at a licensed bank no later than the first business day after a transaction. They must then arrange for the customer or beneficiary to receive the funds within one business day of the deposit.
The amendment requires the government to formulate and publish any regulations needed to implement the changes within 30 days of the law coming into force.
The amendment takes effect upon being passed, ratified by the President and published in the Government Gazette.
President Muizzu ratified the first amendment to the the National Payment System Act last year, which empowers the Maldives Monetary Authority (MMA) to develop national payment infrastructure, including through partnerships or joint ventures. It also requires MMA authorisation to operate covered systems and allows fines of MVR 100,000 to MVR 10 million for violations.
