The development of communication media, especially mobile devices with internet access, has led to the appearance and rapid growth of several new types of electronic payment services. In particular, as technology advances, software applications that can be used from mobile devices have quickly developed as easy, reliable and secure platforms from which to perform payment transactions, thus increasingly gaining popularity among consumers and retailers.
For obvious reasons, Macau SAR provides an appealing arena for the use of such payment methods, especially by retailers and hospitality service providers, as these platforms exponentially facilitate international transactions with reduced risks.
In many legal systems, legislation has been put in place to regulate the advances in these areas. This legislation often not only provides a comprehensive regulatory framework for payment services and payment services institutions, but also regulates the licensing process in terms that allow non-traditional financial institutions also to provide these services.
In Macau there is still no specific regulation in this area and therefore the matter falls under the Macau Financial System Act (DL 32/93/M), which sets out the legal infrastructure of the Macau financial system. The provision of payment services as well as the issuance and management of payment means constitutes a financial activity, and therefore only financial institutions duly licensed by the Macau Monetary Authority may provide such services in Macau. The law however, provides no definition of payment services, which naturally raises issues as to whether certain activities qualify as financial activity or merely as simple ancillary services.
The types of financial institutions that may provide payment services include banks and special financial institutions set up exclusively to provide such services under a 'non-bank credit institution licence'. Any international player engaging in these activities may therefore operate in Macau either in collaboration with a local financial institution or by setting up a local subsidiary or branch exclusively dedicated to such activity.
The licensing procedure requires verification of the proposed institution's financial capability and of the suitability of its principal representatives and shareholders. The law, however, does not specify the capital requirements for setting up and licensing such an entity. Those requirements will be defined in an executive order, after consideration of the information concerned in each particular application.
|João Nuno Riquito||Rui Filipe Oliveira|