MAS Digital Payment Token (DPT) licensing — Step-by-step walkthrough
Raffles Corporate Services works with a panel of corporate and employment law firms; this article is general information, not legal advice.
An mas digital payment token licence authorises a firm to deal in, or facilitate the exchange of, cryptoassets in Singapore. DPT service is a regulated payment service, so a provider must hold either a Standard Payment Institution or Major Payment Institution licence from the Monetary Authority of Singapore before it goes live.
What an MAS digital payment token licence covers
Under the Payment Services Act 2019, “digital payment token service” means dealing in digital payment tokens or facilitating the exchange of digital payment tokens. Section 5 of the Payment Services Act 2019 provides that no person may carry on a business of providing a payment service in Singapore unless that person is licensed or exempt. The framework folds DPT activity into the same modular licensing structure used for account-issuance, e-money and cross-border transfer services, which is why a single payment-institution licence can cover several activities at once.
Across 2024 to 2026 the regime was tightened. DPT providers became subject to enhanced consumer-protection rules, segregation of customer assets, restrictions on lending and staking of retail customers’ tokens, and a dedicated framework for single-currency stablecoins. The direction of travel is clear: MAS treats DPT licensing as a higher-risk activity and expects institutional-grade controls from day one.
Who needs an MAS digital payment token licence
Exchanges, brokers, OTC desks, custodial wallet operators and firms facilitating cross-border token transfers all fall within scope. Wealth managers offering token exposure should check whether their activity is DPT dealing or a capital markets activity, because the two regimes have different capital and conduct requirements. Many groups pair a DPT permission with fund-management activity; our walkthrough of MAS Payment Services Act licensing (MPI and SPI) sets out the parent framework in detail.
Eligibility and base requirements
The applicant must be a Singapore-incorporated company with a permanent place of business, at least one executive director resident in Singapore, and controllers who satisfy the fit-and-proper criteria. A Major Payment Institution must maintain base capital of S$250,000; a Standard Payment Institution must maintain S$100,000. DPT providers must hold customer assets on trust, appoint a compliance officer and a money-laundering reporting officer, and meet MAS technology-risk-management and AML/CFT standards, including the FATF travel rule for token transfers.
Cost and timeline
Application fees payable to MAS are S$1,500 for a Standard Payment Institution and between S$1,500 and S$10,000 for a Major Payment Institution, depending on the activities applied for. Expect a realistic end-to-end timeline of 9 to 14 months from filing to approval, with MAS commonly issuing two to three rounds of written queries. Budget S$80,000 to S$250,000 for legal advice, the compliance build-out and the independent assessments MAS typically requires before granting approval.
Step-by-step process
First, incorporate or confirm the operating company and appoint a resident director, a compliance officer and a money-laundering reporting officer. Second, build the compliance manual, the enterprise risk assessment and the custody arrangement, including how customer tokens are segregated. Third, submit the application through the MAS online portal with the business plan, financial projections and controller declarations. Fourth, respond to MAS queries and complete the pre-licensing assessment, which may include an external audit of controls. Fifth, satisfy the conditions of any in-principle approval before the licence is granted, then go live under ongoing supervision. Foreign founders should also confirm the corporate vehicle is correctly set up; see our guide to Singapore Pte Ltd registration for foreigners.
A worked numerical example
Consider a token brokerage applying as a Major Payment Institution for DPT dealing. It maintains base capital of S$250,000, pays an application fee in the region of S$5,000, and spends roughly S$150,000 on legal, compliance and a controls audit over a 12-month assessment. It appoints two resident control staff and budgets a security deposit and ongoing supervisory levies. The fully loaded first-year cost lands near S$400,000 once salaries are included, which is typical for an institutional-grade DPT launch.
Ongoing obligations after licensing
A licensed DPT provider must file periodic returns, maintain its base capital and security, keep customer assets segregated, and conduct ongoing transaction monitoring and suspicious-transaction reporting. It must also keep its risk-assessment current and notify MAS of material changes in controllers or business model. Where a fund sits above the trading entity, the Permissible Fund Manager rules under Section 46 of the VCC Act 2018 set out who may manage the vehicle.
Common mistakes and gotchas
The most frequent failures are an under-resourced compliance function, weak proof of segregated custody, and travel-rule gaps on cross-border transfers. Applicants also underestimate the assessment timeline and run out of runway before approval. Treating retail and institutional customers identically is another trap, because the retail conduct rules are stricter.
FAQs
Is a DPT licence the same as a crypto exchange licence? In substance yes; DPT service is the regulated activity that crypto exchanges and brokers carry on under the Payment Services Act 2019.
Can I operate while my application is pending? Only if you held a transitional exemption; new entrants must wait for the licence or for an in-principle approval with conditions met.
How much capital must I keep? S$100,000 base capital for a Standard Payment Institution and S$250,000 for a Major Payment Institution, plus any MAS-imposed buffers.
Does MAS regulate stablecoins separately? Yes. MAS finalised a single-currency stablecoin framework imposing reserve, redemption and disclosure rules on issuers.
How long does the whole process take? Around 9 to 14 months for a clean, well-resourced application.
Authoritative sources: the Monetary Authority of Singapore and the Payment Services Act 2019 on Singapore Statutes Online.