1. This Regulation applies to all SVF as defined in Article (1) Definition.

License required for issuing SVF

2. Issuing and operating SVF in the State requires a prior License from the Central Bank. It is prohibited to carry on the activity of issuing or operating SVF without prior License except if the issued SVF is a Single-purpose Stored Value Facility.

Exclusion of certain types of SVF

3. On application by an Issuer, the Central Bank may exempt an SVF from the licensing requirements and will do so based on the risk the SVF poses to its (potential) Customers, Customer funds and the financial system.
    
4. The types of SVF that may be exempted from the licensing requirements by the Central Bank include:
    
   1. 4.1. SVF used for certain cash reward schemes. Such SVF may be used for storing only a sum of money paid by (i) the issuer; or (ii) a person who agrees to pay a sum of money for storage in the facility under an agreement with the issuer and the sum of money stored may only be used for making payments for goods or services provided by the issuer or person under very specific terms and conditions of the facility. Examples include loyalty schemes provided by shops and supermarkets which offer cash rewards for customer loyalty;
       
   2. 4.2. SVF used for purchasing certain digital products. Such SVF may only be used as a means of making payments for goods or services that are delivered to, and are to be used through, a telecommunication, digital or technology device; the payments are executed through such a device; and the telecommunication, digital or technology operator acts as an intermediary between the Customer of the facility and the provider of the goods or services. Examples include purchase of digital contents such as ringtones, music, videos, electronic books, games and applications that can be used on smartphones, computers or other information technology devices;
       
   3. 4.3. SVF used for certain bonus point schemes. Such SVF may be used only for storing points or units (by whatever name called) that are Money’s Worth provided by (i) the issuer; or (ii) a person who agrees to provide goods or services to the Customer under an agreement with the issuer. The Customer may use the points or units for making payments for the goods or services provided by the issuer or person either by (i) using only the points or units; or (ii) using the points or units together with a sum of money (in any currency) that is stored on the facility temporarily for the sole purpose of executing the payments; and the sum of money so stored is not redeemable for cash. Examples are airline mileage programs and customer loyalty schemes that provide non-cash points to customers to reward their patronage, and whereby such points and value stored, if any, is not redeemable for cash;
       
   4. 4.4. SVF that can only be used within a limited group of goods or services providers. Such SVF may be used as a means of making payments only for goods or services provided by (i) the issuer; or (ii) a person who provides the goods or services under an agreement with the issuer; and
       
   5. 4.5. whereby (i) the aggregate amount of the Float of the facilities does not exceed half a million Dirham (500,000 AED) or its equivalent and the aggregate number of Customers is not more than 100. If a potential SVF Issuer wishes to apply for this particular exemption, the SVF is required to test out its product before making a full launch of SVF. In this regard, the relevant issuer is required to participate in the Central Bank’s FinTech Office sandboxing arrangement for a possible trial run.
       
5. The Central Bank may request any information from an exempted SVF Issuer when the Central Bank considers it necessary to determine its eligibility for exemption and continued exemption. The Central Bank may declare an SVF not exempt from the licensing requirement and require the issuer of the SVF to apply for a License.

Overseas SVF schemes

6. It is prohibited for an SVF without a prior License to publish in the State or elsewhere, an advertisement, invitation or document which is, or contains, an invitation or a solicitation to the public of the State relating (whether in whole or in part) to the issuance of SVF.

Relevant factors to be considered

7. The Central Bank will take into account the factors to determine whether an overseas SVF is issued in the State or a person publishes an advertisement, invitation or document which is, or contains, an invitation or solicitation to the State public relating to the issuance of SVF.
    
8. In determining whether an SVF scheme is presented or provided in such a manner that it appears to be issued in the State, the Central Bank will consider all relevant factors including, in particular, the following:
    
   1. 8.1. whether the location for the delivery of the facility and the provision of the subsequent customer service to facility users is in the State;
       
   2. 8.2. whether the location for and the manner to top-up the SVF is through channels in the State (e.g. banks in the State);
       
   3. 8.3. whether the promotional material is targeted, via “push” techniques, at a group or groups of people whom the issuer knows, or should reasonably know, reside in the State. “Push” techniques include spamming, broadcasting or directing information to a particular person or group of people through, for instance, e-mails, SMS messages and any social media channels;
       
   4. 8.4. whether any news group, bulletin board, chat room or similar facility associated with the site has been used to promote the SVF service in the State; and
       
   5. 8.5. in the case of services details and promotional material hosted on a site, the Central Bank will assess whether the website's existence has been included in a State search engine or the State section of a search engine; and whether the SVF advertisements, in print or online forms, are easily accessible in the State and whether the website has been advertised in the State through advertising agencies, in periodicals (e.g. newspapers, journals or electronic publications) or by broadcasting (e.g. television or radio).
       
9. In determining whether the content of the issuer’s website and the relevant promotional materials are written in a manner which gives an impression that the SVF is issued in the State, the Central Bank will take a holistic approach and consider a host of factors including but not limited to the following:
    
   1. 9.1. whether representations made in any promotional materials and advertisements regarding the location of the issue of the SVF and the usage of that facility is in the State; and
       
   2. 9.2. whether the website and its functions are designed in a manner that may imply or give the impression that the SVF is issued in the State, such as the languages used in the SVF website (e.g. the Arabic language), the use of particular domain name such as a State domain name, the currencies accepted for the services (e.g. AED), contact details in the State.
       
10. The Central Bank will consider all relevant factors including, in particular, whether reasonable precautions are in place to avoid the promotional materials being made available or accessible to persons in the State and whether the issuer has systems in place to avoid providing services to persons residing in the State.
     
11. The Central Bank may also consider matters such as whether the SVF Issuer has established a physical presence in the State; and whether it has established business relationships with banks or financial institutions in the State for payment or other banking support services in the State.
     
12. The above factors and criteria are neither exhaustive nor conclusive. The Central Bank will use a holistic approach to judge each case on its merits and take into account the particular circumstances and all relevant facts.