Entry Bar for Payment Providers Raised by New Capital Rules
Licensed providers must maintain the required level of unimpaired capital at all times. | Photo: MV+
Payment service providers in the Maldives will face a substantially higher financial threshold under new capital requirements introduced by the Maldives Monetary Authority, raising the cost of entering and remaining in the regulated payments market.
The revised requirements were introduced through an amendment to the Payment Services Regulation published in the Government Gazette on Thursday. Licensed providers must maintain the required level of unimpaired capital at all times.
advertisement
advertisement
Minimum capital for electronic money issuance services has increased from MVR 500,000 to MVR 2 million, representing a fourfold rise.
The requirement for payment transaction accommodation services and remittance services has increased tenfold, from MVR 200,000 to MVR 2 million. Payment initiation services and account information provision services must now maintain MVR 1 million, up from MVR 100,000.
Payment service Previous requirement New requirement Electronic money issuance MVR 500,000 MVR 2 million Payment transaction accommodation MVR 200,000 MVR 2 million Remittance services MVR 200,000 MVR 2 million Payment initiation services MVR 100,000 MVR 1 million Account information provision MVR 100,000 MVR 1 million
For existing providers, the amendment may require additional capital injections or changes to their financial structures to maintain compliance. Businesses considering entering the sector will also need considerably more initial funding before obtaining and operating under a licence.
The higher thresholds could create difficulties for smaller financial technology companies and new entrants with limited access to capital. This may reduce the number of operators able to enter the market or encourage businesses to seek investors and commercial partnerships.
However, stronger capital positions could improve the ability of providers to absorb operational losses, address service disruptions and meet their obligations to customers. This is particularly relevant as businesses and consumers increasingly depend on digital payments, remittance platforms and electronic money services.
MMA said the changes are intended to ensure that licensed providers can continue operating safely and without interruption when faced with financial or operational losses. The authority also linked the requirements to maintaining public confidence and ensuring that payment services are operated by financially sound institutions.
The amendment therefore introduces a trade-off for the developing payments sector. While it increases the financial burden on providers, it also seeks to reduce the risk of service failures and establish a more resilient foundation for the expansion of digital financial services.
