The MAS Payment Services Act creates a new licensing pathway for crypto businesses in Singapore starting in 2025
Singapore's Monetary Authority (MAS) introduced the Payment Services Act (PSA) to regulate digital payment providers, including cryptocurrency and stablecoin businesses. Beginning in 2025, crypto companies operating in Singapore must obtain a license under this framework or cease operations. The act establishes clear categories for different types of payment services, sets capital and governance requirements, and creates a formal application process. This is not optional — it is the legal requirement for any crypto business handling customer funds or offering payment services in Singapore.
The PSA replaces a previous system where many crypto activities operated in a gray zone. Now there is a defined pathway: companies must determine which license category fits their business model, meet the specific requirements for that category, and submit an application to MAS. The timeline matters — businesses that do not have a license by the deadline face enforcement action.
Key Takeaways
- The Payment Services Act requires all crypto and stablecoin businesses in Singapore to hold an MAS license by the 2025 deadline or stop operating.
- License categories include Major Payment Institutions, Standard Payment Institutions, and Exempted Payment Institutions, each with different capital, governance, and operational requirements.
- The application process involves submitting detailed documentation about ownership, technology, compliance systems, and customer protection measures to MAS.
- Businesses that already hold a license or have submitted an application before the deadline may operate under a transitional arrangement while MAS reviews their submission.
- Crypto exchanges, stablecoin issuers, and wallet providers each face different regulatory requirements depending on the services they offer.
Which license category your crypto business needs
The PSA divides payment service providers into three main categories, and which one applies to you depends on the volume of transactions you handle and the type of service you offer. Major Payment Institutions handle large transaction volumes — typically more than SGD 3 million per month — and must hold at least SGD 5 million in capital. This category includes large exchanges and stablecoin issuers. Standard Payment Institutions handle smaller volumes and must hold SGD 500,000 in capital. Most smaller crypto platforms and wallet providers fall here. Exempted Payment Institutions are businesses that meet specific narrow criteria — for example, they may only handle certain types of transactions or operate within defined limits — and face reduced requirements.
Your category determines what you must do next. If you operate a crypto exchange that processes customer deposits and withdrawals, you are likely a Major or Standard Payment Institution. If you issue a stablecoin, you are a Major Payment Institution. If you run a non-custodial wallet or provide only information services, you may fall into an exempted category or outside the act entirely — but you must verify this with MAS, not assume it.
Capital, governance, and operational requirements
Each license category requires different levels of capital reserves, and MAS uses these reserves to protect customers if the business fails. Major Payment Institutions must maintain at least SGD 5 million; Standard Payment Institutions must maintain SGD 500,000. These are not one-time payments — they must be held continuously and cannot be used for normal business operations. You also cannot borrow this money; it must come from genuine capital.
Beyond capital, MAS requires documented governance structures: a board of directors, a compliance officer, an audit function, and written policies for customer due diligence, anti-money laundering, and fraud prevention. You must demonstrate that your technology infrastructure is secure, that you have tested your systems for vulnerabilities, and that you have a plan to respond if something goes wrong. You must also show that your owners and key staff have no criminal history and are fit to hold a license. MAS will conduct background checks on all directors, shareholders with significant stakes, and senior management.
The application process and timeline
The application begins with determining your license category and gathering the required documents. You will need to submit: proof of capital reserves, a detailed business plan describing your services and customer base, organizational charts and résumés for all directors and senior staff, copies of your compliance policies, details of your technology infrastructure and security measures, and proof of your identity and background for all owners and key personnel. MAS provides a checklist on its website, and the requirements are specific — incomplete applications are returned without review.
Once submitted, MAS typically takes three to six months to review an application, though complex cases can take longer. During this time, MAS may ask follow-up questions or request additional documentation. You should budget for this delay and plan accordingly. If you submitted an application before the 2025 deadline, you may continue operating under a transitional arrangement while MAS reviews your submission — but this protection only applies if your application was complete and on time.
What happens if you do not have a license by the deadline
Crypto businesses that do not hold a license and do not have a pending application by the deadline face enforcement action from MAS. This can include cease-and-desist orders, fines, and criminal prosecution for individuals involved in unlicensed payment services. Customers may also lose legal recourse if something goes wrong — an unlicensed platform has no regulatory obligation to return funds or maintain reserves.
If you are operating a crypto business in Singapore and have not yet applied, the time to start is now. The application process takes months, and waiting until the last moment leaves no room for delays or requests for additional information. If your business model does not fit any license category, you should seek written confirmation from MAS that you are exempt — do not assume you are outside the act.
How the PSA affects different types of crypto businesses
Crypto exchanges that allow customers to buy, sell, or trade digital assets must hold a license because they custody customer funds. They fall into the Major or Standard category depending on transaction volume. Stablecoin issuers must hold a Major Payment Institution license because they are creating a payment instrument. Wallet providers that hold customer private keys or funds must be licensed; those that only provide software tools may be exempt if they do not custody assets. Payment processors that facilitate transactions between merchants and customers must be licensed. Lending platforms that accept crypto deposits must be licensed because they are holding customer assets.
If your business offers multiple services — for example, an exchange that also issues its own token — you may need to meet the requirements of the highest category that applies to any of your services. The safest approach is to contact MAS directly and describe your business model; they will tell you which category applies.
Transitional arrangements and ongoing compliance
MAS recognizes that some businesses may need time to meet all requirements. If you submitted a complete application before the deadline, you can continue operating while MAS reviews it. This is not a permanent exemption — it is a window that closes once MAS makes a decision. If your application is rejected, you must stop operating immediately. If it is approved, you must comply with all license conditions going forward.
Once licensed, you must file regular reports with MAS, maintain your capital reserves, update your compliance policies, and notify MAS of any material changes to your business — new services, new owners, changes to your technology platform, or significant increases in transaction volume. MAS conducts periodic audits and can impose additional conditions or revoke your license if you breach the act or fail to meet ongoing requirements.
Frequently Asked Questions
Do I need a license if I only provide information about crypto, not actual trading?
If you do not hold customer funds or facilitate transactions, you may not need a license. However, the line between information services and payment services can be unclear. If you have any doubt, contact MAS directly. Assuming you are exempt and being wrong can result in enforcement action.
What if I am based outside Singapore but have Singapore customers?
If you offer services to Singapore residents or accept Singapore currency, you are operating in Singapore and must be licensed. MAS enforces this against offshore platforms. The safest approach is to geofence your service to exclude Singapore or obtain a license.
Can I get a license extension if I cannot meet the deadline?
MAS has not announced blanket extensions beyond the stated deadline. Your only protection is submitting a complete application before the deadline, which allows you to continue operating during the review period. If you are close to ready, submit now rather than wait.
What happens to my customers' funds if my license application is rejected?
You must return all customer funds immediately. If you cannot, you may face legal liability and criminal charges. This is why having adequate capital reserves and compliance systems is critical — they protect both you and your customers.
Does the PSA apply to decentralized finance (DeFi) platforms?
It depends on whether you are providing a service or just hosting code. If you operate a platform that holds customer funds, matches trades, or issues tokens, you likely need a license. If you only provide open-source code with no control over how it is used, you may not. The distinction is fact-specific, and MAS guidance on DeFi is still developing.