Taiwan

Taiwan Finance Committee Streamlines Development of Mobile Payments Services

December 30, 2023         By: Michael Cheng

Taiwan could be the next payments hub in Asia for businesses that are looking for supportive regulations and above average daily transaction caps.

The country’s Finance Committee submitted a review of a draft act on the governance of third-party payments services. The 58-article draft could help boost the advancement of a wide range of companies, including SMBs.

If all goes well, clearing of the second and third reading is expected by the end of January. After clearance and pronouncement by the president, the Cabinet will likely put the act into effect within 3 months.

William Tseng, chairman of the Financial Supervisory Commission (FSC), said, “The final version of the act has been in line with our expectations, and we hope to implement it as quickly as possible, to help facilitate the development of domestic third-party payment service providers.”

Three versions of the Payment Processing Institutions Act were reviewed by the representatives, namely from the following: the Cabinet and the Chinese Nationalist Party (KMT) legislators Lee Guei-min and Sun Ta-chien.

One of the highlights in the draft includes a decreased minimum in the amount of NT$100 million (paid-in capital) for companies making third-party payment collections and transfers. The former outline by the Cabinet was set at NT$300 million.

The financial committee aims to set the threshold for various digital payments providers at roughly NT$500 million (paid-in capital) for increased accountability. For basic deposits and transactions, the preliminary version indicates a daily limit of NT$50,000 per person, which is almost double the previous amount.

The updates did not have an immediate effect on the industry. Analysts expect a sudden surge of growth in the sector once the plans become more concrete and payments providers begin to take advantage of the lax transaction caps.