Fintech firms can soon offer currency-exchange services
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Non-bank institutions will be allowed to directly engage in currency exchange business starting next month as part of a broader deregulation drive to promote the local financial technology sector, the finance ministry said Tuesday.
Under revised regulations on currency exchange, a qualified fintech firm will be able to offer a currency exchange service of up to $2,000 per person through their online platforms.
Such fintech firms are required to make a reserve against potential claims from customers and set up a technical safety system, the ministry said.
In 2016, a total of $5.26 billion was traded in currency exchanges.
The government has been lifting regulations on foreign currency trading as part of a general effort to reduce the administrative regulations that have been cited for holding up market growth.
Questions & Answers
Q.What is the new daily limit for currency exchange transactions through fintech platforms?
What is the new daily limit for currency exchange transactions through fintech platforms?
Qualified fintech firms will be permitted to offer a currency exchange service of up to $2,000 per person. This service will be accessible through their online platforms once the revised regulations take effect next month.
Q.What new requirements must fintech firms meet to offer these services?
What new requirements must fintech firms meet to offer these services?
Fintech firms are mandated to maintain a reserve against potential customer claims. Also, they must establish a robust technical safety system to comply with the new regulations set by the finance ministry.
Q.When can fintech firms begin offering these new currency exchange services?
When can fintech firms begin offering these new currency exchange services?
Non-bank institutions, including qualified fintech firms, will be allowed to directly engage in currency exchange business starting next month. This follows the finance ministry's announcement on Tuesday regarding revised regulations.
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