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  • Article (15): Regulatory Capital Supplementary Requirements (for all Licensed Payment Token Service Providers)

    1.

    The Central Bank may impose aggregate regulatory capital requirements higher than that provided for in Article (13) and Article (14) if, taking into consideration the scale and complexity of the Licensee’s business, it considers such higher requirements essential to ensuring that the Licensee has the ability to fulfil its obligations under this Regulation.

    2.

    An Applicant shall provide information to the Central Bank on the source(s) of funds that constitute the regulatory capital held under Article (13) or Article (14).

    • Capital Items

      3.

      A Licensed Payment Token Service Provider’s aggregate regulatory capital shall consist of:

      a)Paid-up capital;
      b)Reserves, excluding revaluation reserves; and
      c)Retained earnings.
      4.In addition to the capital requirement, an unconditional irrevocable bank guarantee equal to the full paid-up capital amount in favour of the Central Bank paid upon first demand, shall be submitted to the Central Bank with the application of the License. Such a guarantee must remain in place at all times.
      5.Licensee must demonstrate that its regulatory capital and other financial resources are sufficient for implementing its business model in a safe, efficient and sustainable manner, without compromising the interests of Customers.
      6.A Licensee must provide adequate details to the Central Bank on the source of funds that will be used to support the proposed business activities.
      7.A Licensee must demonstrate that it will be able to maintain sufficient regulatory capital and other financial resources to facilitate an orderly wind-down of its Payment Token business, including a smooth refunding process.

    • Deductions

      8.

      The following items shall be deducted from the aggregate regulatory capital:

      a)

      Accumulated losses;

      b)

      Anticipated losses in the first year of operation;

      c)

      Goodwill;

      d)

      Any assets encumbered to secure the unconditional irrevocable bank guarantee; and

      e)

      Any other items which the Central Bank may direct from time to time.

      9.

      If a Licensed Payment Token Service Provider is both:

      a)

      Licensed as a Payment Token Conversion Provider or Payment Token Custodian and Transferor; and

      b)

      licensed or regulated for any Virtual Asset activities by SCA or any Local Licensing Authority,

      any regulatory capital it holds pursuant to requirements imposed by SCA or any Local Licensing Authority shall not contribute towards satisfying the regulatory capital requirements in this Article (15).