KUALA LUMPUR (Dec 29): Bank Negara Malaysia (BNM) has issued an exposure draft on the minimum standards that a money services business (MSB) must observe to ensure good governance practice, robust risk management and internal control systems in carrying out money services activities.

BNM said the exposure draft had been revised to further elevate the standards of professionalism and compliance in the industry, while strengthening safeguards against money laundering and terrorism financing, while enhancing customer protection.

In the exposure draft, BNM announced that the MSB segment has evolved into a modern industry with services via digital channels and the traditional branch and agent networks which had provided consumers with easy access and enhanced user experience as well as higher levels of business professionalism and compliance standard.

“Notwithstanding this positive development, continuous effort to further strengthen the industry is important, particularly considering its unique and distinct risk nature, which is susceptible to abuse.

“In view of this, an enhancement to regulatory requirements for the MSB industry, particularly in terms of the governance, risk management, operational requirements, and IT requirements, is timely and important to reflect these significant developments,” stated BNM on the objective of the exposure draft.

The central bank added that the exposure draft will complement the existing Money Services Business Act 2011 and the Money Services Business (Duties of Licensees) Regulations 2012.

Written responses must be submitted to BNM at [email protected] by Feb 28, 2022.

The exposure draft can be accessed at https://www.bnm.gov.my/documents/20124/964944/ED_GovRMOps_MSB.pdf