MAS Payment Services Act licensing — MPI and SPI — Complete 2026 guide
MAS Payment Services Act licensing is the gateway authorisation for any entity carrying on a payment service in Singapore under the Payment Services Act 2019. The two principal licence classes are the Major Payment Institution (MPI) and the Standard Payment Institution (SPI), distinguished primarily by the volume of payment transactions and the magnitude of e-money float a firm handles each calendar month.
Raffles Corporate Services works with a panel of corporate and employment law firms; this article is general information, not legal advice.
What MAS Payment Services Act licensing covers
The Payment Services Act 2019 (PS Act) consolidated the prior Payment Systems (Oversight) Act and the Money-Changing and Remittance Businesses Act into a single activities-based licensing regime. Section 5 of the PS Act sets out the seven payment service activities: account issuance, domestic money transfer, cross-border money transfer, merchant acquisition, e-money issuance, digital payment token services, and money-changing. A licensee is authorised for one or more specified payment services, and the licence terms list each authorised activity expressly.
Section 6 of the PS Act establishes three licence classes: the Money-Changing Licence (limited to money-changing only), the Standard Payment Institution (SPI) and the Major Payment Institution (MPI). The MPI authorisation is required where transaction volumes or e-money float exceed the thresholds set out in Regulation 5 of the Payment Services Regulations.
SPI versus MPI — the threshold tests
The threshold split is mechanical. A firm qualifies for the SPI class if its monthly transaction volume for any single payment service does not exceed S$3 million, its monthly transaction volume across two or more payment services does not exceed S$6 million, and its daily outstanding e-money does not exceed S$5 million. Cross-border money transfer is the principal exception — there is no SPI ceiling on cross-border MT, so any firm operating a cross-border MT service must hold an MPI.
Once a firm’s projected or actual volumes exceed these thresholds, the MPI authorisation becomes the only option. Sponsors planning growth typically apply directly for an MPI to avoid a mid-cycle uplift, even when day-one volumes would fit an SPI.
Eligibility — who can hold an MPI or SPI
Both licences are available only to Singapore-incorporated companies with a permanent place of business in Singapore. The firm must have at least one executive director who is ordinarily resident in Singapore, and a CEO with substantive payments or fintech experience. MAS expects a clear governance structure with an independent compliance function and, for MPIs, a dedicated risk and compliance officer with adequate authority and seniority.
The legal personality of the licensee matters. Separate legal personality under the Companies Act 1967 and equivalent statutes matters because the licence is granted to the entity, not the group, and any change of control triggers a Section 28 PS Act notification or approval requirement depending on the threshold crossed.
Capital and prudential requirements
The base capital floor for an SPI is S$100,000 and for an MPI is S$250,000, both required to be maintained on an ongoing basis. MPIs additionally face safeguarding requirements for e-money issuance and certain account issuance activities — relevant customer money must be safeguarded through one of three permitted methods: (a) a trust account at an MAS-licensed bank, (b) an undertaking from a Singapore-incorporated bank, or (c) an undertaking from a prescribed insurer. Safeguarding rules are set out in Regulation 17 of the Payment Services Regulations.
Operational risk requirements scale with the activities authorised. Cross-border money transfer firms with significant volumes face stricter transaction monitoring expectations under the AML/CFT framework in MAS Notice PSN01 (covering e-money, account issuance and money transfer) and MAS Notice PSN02 (digital payment tokens). The Notices require a customer due diligence programme that meets FATF Recommendations as adapted by MAS, ongoing transaction monitoring, and prompt suspicious transaction reporting to the Suspicious Transaction Reporting Office.
Cost and timeline for an MPI or SPI application
Application fees are S$1,500 for an SPI and S$5,000 for an MPI; renewal is annual at the same rate. External advisory cost stack is typically: regulatory counsel S$60,000 to S$150,000 for an MPI (less for an SPI); compliance build-out and policy authoring S$30,000 to S$80,000; technology and security assessment S$20,000 to S$60,000; safeguarding bank set-up S$5,000 to S$15,000. Total external cost is typically S$120,000 to S$300,000 for an MPI before capital injection.
Timeline: scoping and pre-filing typically takes 8 to 12 weeks; MAS first-round review takes 12 to 16 weeks; query rounds and operational walkthroughs add a further 12 to 24 weeks; total elapsed time is generally 8 to 14 months for an MPI and 5 to 9 months for an SPI.
Step-by-step PS Act application
Step 1: incorporate the Singapore Pte Ltd licensee or repurpose an existing entity. Open a corporate bank account — see Singapore bank account opening — DBS, OCBC, UOB, Wise, Aspire for the practical mechanics. Step 2: capitalise the entity. Step 3: hire the CEO, executive director and compliance officer onshore. Step 4: build the policy stack — AML/CFT manual, transaction monitoring policy, sanctions screening procedure, technology risk management policy, business continuity and outsourcing policies. Step 5: appoint the safeguarding bank for relevant money and confirm safeguarding arrangements in writing with MAS. Step 6: prepare and file the MAS application via the FINNet portal: business plan, organisation chart, technology architecture diagrams, financial projections, AML/CFT manual, fit-and-proper declarations. Step 7: respond to MAS queries. Step 8: pre-launch operational walkthroughs — MAS typically asks for a demo of the transaction monitoring system, the sanctions screening tool and the customer onboarding flow. Step 9: obtain licence-in-principle, complete any final conditions, and commence live operations.
Common mistakes and gotchas
The most common mistake is a weak AML/CFT framework — the application is rejected or significantly delayed where the customer due diligence framework, transaction monitoring rules and sanctions screening tooling are not articulated to a production-ready standard. The second is over-claiming activities — firms that apply for all seven payment services on day one (because “we might do that eventually”) are pressed hard to demonstrate operational readiness for each activity. The third is undercooked safeguarding — MAS expects the safeguarding bank to be identified, with a signed trust deed or undertaking, before licence-in-principle is granted. The fourth is technology risk — MAS expects a comprehensive technology risk management framework aligned to the MAS Technology Risk Management Guidelines and the Notice on Cyber Hygiene.
Sponsors should also plan ahead on the MAS Capital Markets Services (CMS) licence question — some payment service business models touch on regulated capital markets activities (custody of digital payment tokens, certain wallet activities) and may need a dual authorisation footprint.
Ongoing compliance after licence issue
Once authorised, MPIs and SPIs file quarterly returns to MAS covering transaction volumes, e-money outstanding, safeguarding reconciliations and complaints data. Annual audited financial statements must be filed within four months of financial year-end. Compliance officers attend an annual confirmation that the AML/CFT framework remains compliant. MAS conducts risk-based on-site inspections; first inspection is typically 12 to 18 months after licence-in-principle, with subsequent inspections every 18 to 36 months depending on risk profile.
FAQs
Can I start with an SPI and upgrade to an MPI later? Yes. Upgrading from SPI to MPI requires a fresh application with refreshed projections, capital and safeguarding arrangements. Sponsors expecting to cross thresholds within 12 months are usually advised to apply directly for an MPI.
Does an SPI need to safeguard customer money? Limited safeguarding applies to SPIs that hold relevant money. The Regulation 17 framework adapts but is less stringent than for MPIs handling significant e-money float.
Can a foreign-incorporated firm hold an MPI or SPI? No. Both licences require a Singapore-incorporated company. Foreign groups must establish a Singapore subsidiary.
How does the digital payment token (DPT) activity differ from other payment services? DPT services (custody, exchange and transfer of digital payment tokens) are subject to MAS Notice PSN02 and to additional consumer protection rules limiting retail exposure, including restrictions on advertising in public places and credit facilities for DPT trading.
What triggers a Section 28 change-of-control notification? Acquiring 5 per cent of a payment institution requires notification; acquiring 12 per cent, 20 per cent or 50 per cent of voting rights requires MAS approval.
Need help with this? Call, SMS or WhatsApp +65 8501 7133, or email [email protected]. Raffles Corporate Services helps PS Act applicants scope, document and operationalise MPI and SPI authorisations — book a scoping call to plan your filing.