Merchant Acquisition
Your business description
Merchant Acquisition definition
According to MAS (Guidelines)
last revised 18 December 2019
Providing merchant acquisition service in Singapore where the service provider processes payment transactions from the merchant and processes payment receipts on behalf of the merchant. Usually the service includes providing a point-ofsale terminal or online payment gateway.
“merchant acquisition service” means any service of accepting and processing a payment transaction for a merchant under a contract between the provider of the service and the merchant, which results in a transfer of money to the merchant pursuant to the payment transaction, regardless whether the provider of the service comes into possession of any money in respect of the payment transaction, in a case where —
(a) the merchant carries on business in Singapore, or is incorporated, formed or registered in Singapore; or
(b) the contract between the provider of the service and the merchant is entered into in Singapore;
The payment services of domestic money transfer, cross border money transfer and merchant acquisition appear to overlap. Is that intended?
According to MAS (FAQs)
last revised on 31 March 2020
16.1 MAS recognises that there may be instances where the service of merchant acquisition overlaps with the service of domestic money transfer or cross border money transfer. For example, the merchant acquirer may provide a domestic money transfer service in the same transaction if it serves the payer as well. This is common for e-wallet (payment accounts that contain e-money) issuers. In another example, the merchant acquirer may provide a cross border money transfer service in the same transaction if it receives money from overseas on behalf of the merchant in Singapore or if it accepts money in Singapore for the purpose of transmitting, or arranging for the transmission of, the money to a merchant overseas. Please note that these examples are for illustration only and are not exhaustive.
16.2 [But even when] a person provides more than one payment service in the course of a payment transaction, the PS Act does not impose duplicative requirements for safeguarding of the funds in transit. The obligation under section 23 for a MPI to safeguard funds in transit for all three services mentioned applies to the total sum of relevant money held by the MPI. This means that if two services are provided in the course of a single transaction, the relevant money to be safeguarded in that transaction does not double simply because two services are provided for the same transaction. Further, in respect of AML/CFT requirements, merchant acquirers that provide other payment services as part of their merchant acquisition business should note that low risk transactions set out in the relevant AML/CFT notice do not attract AML/CFT measures.
16.3 That said, a person should ensure that the person has in force a licence that entitles the person to carry on a business of providing all the payment services the person provides.
(Edits by FinReg)
What are some examples of entities that provide merchant acquisition services?
last revised 31 March 2021
14.1 As mentioned in Table 1 of the Consultation Paper on Proposed Payment Services Bill, an entity provides merchant acquisition services where the entity enters into a contract with a merchant to accept and process payment transactions, which results in a transfer of money to the merchant. Usually the service includes providing a point of sale terminal or online payment gateway.
14.2 A payment service provider that operates a closed-loop e-money account issuance service, where transactions can only take place between users of the particular e-money accounts issued by the payment service provider, may also be providing a merchant acquisition service if one of the users is a merchant and there is the requisite contractual relationship mentioned above.