So far in our eWallet 101 series, we’ve covered everything from the pros and cons of eWallets to how safe your money is when held by eWallet companies. This time around, we’re starting off on a more serious note by looking into the legalities of things. What are the laws and regulations governing eWallets in Malaysia? Do we even have any in the first place? E-Wallet laws and regulations in MalaysiaIn recent years, the Malaysian government, Bank Negara Malaysia and other relevant authorities have made their stance on the push for a cashless society clear. They’re all for it! One of the areas we can see this is in the comprehensive regulatory framework put in place for eWallets, particularly those looking to apply for authorisation. The awesome team of editors, lawyers and researchers at Payments Compliance have looked into this extensively. Read their full guide to e-money licensing here.
That’s a lot of documents to go through! Below, we’ve extracted some key points that may be most relevant to you as an eWallet user. Applying for Licensure
Operational and Compliance Requirements
Management of Funds
Risk ManagementE-Wallets are obliged to implement a robust security risk management framework that will address:
What isn’t covered by our existing eWallet laws and regulations?According to Payments Compliance, Malaysia’s current regulatory framework does not extend to closed-loop eWallets. We’ve addressed open-loop vs closed-loop eWallets before, but closed-loop eWallets are essentially eWallets that are exclusive to a specific retailer. A prime example would be Starbucks’ loyalty cards. Does PIDM protect my money in eWallets?PIDM is a government agency which protects our deposits in banks. Outside of banks however, perhaps the biggest concern for users using other forms of financial services (such as investment apps or eWallets) is whether or not our money is protected in the same way. The answer? Yes! PIDM protects eWallet users indirectly by protecting the funds that are placed by eWallet companies in PIDM member banks. However, remember that non-bank eWallets such as Grab and Boost are not PIDM member institutions, hence PIDM does not directly protect e-money which is being used as a payment instrument. What does this mean for me as an average eWallet user?In a nutshell, the eWallet landscape in Malaysia is a pretty safe and secure place for users. Thanks to efforts from relevant authorities pushing the transition to a cashless economy, we’re lucky to have a comprehensive regulatory framework in place for eWallets applying for licensure. If there’s one thing to take away from this article, it’s to never use unauthorised eWallets – no matter how irresistible their offers! Remember that these laws and regulations only apply to licensed eWallets. Click here to view the full list of non-bank e-money issuers. Now that you’ve got the basics of eWallet laws and regulations in Malaysia down pat, check out our other eWallet resources to make the most of your eWallet usage. From https://blog.ewhallet.com/e-wallet-laws-and-regulations-in-malaysia/ From https://kimberlyroberts0.blogspot.com/2020/07/e-wallet-laws-and-regulations-in.html from https://kimberlyroberts0.wordpress.com/2020/07/15/e-wallet-laws-and-regulations-in-malaysia-heres-what-you-need-to-know/ from https://marlodubreuil.blogspot.com/2020/07/e-wallet-laws-and-regulations-in.html
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