MPI License in Singapore: Requirements, Benefits & Application Process

Singapore has clearly established itself as one of the world's leading fintech hubs. And a big part of that reputation comes down to how clear its regulatory frameworks are.

The Payment Services Act 2019, for instance, brought structure and transparency to how payment businesses operate in Singapore, giving companies a clear framework to build on.

At the heart of that framework sits the Major Payment Institution (MPI) license. For payment businesses with serious growth ambitions, the MPI license is what allows you to scale without transaction caps and with the credibility to match.

Here, we’ll uncover everything you need to know about the MPI license, from what it is and who needs it to how to apply.

An MPI license, or Major Payment Institution License, allows businesses in Singapore to offer high-volume payment services. The license is issued by the Monetary Authority of Singapore (MAS), under the regulatory backing of the Payment Services Act 2019, to businesses whose payment thresholds exceed the following limits:

• S$3 million transactions per month for any payment service except electronic money (e-money) account issuance and money-changing services.
• S$6 million transactions per month for two or more payment services, excluding e-money account issuance and money-changing services.
• S$5 million of daily outstanding e-money. 

If you’re operating within these limits, you need to obtain a Standard Payment Institution (SPI) license.

Under the Payment Services Act 2019, payment service providers can get three types of licenses:

• Major Payment Institution license
• Standard Payment Institution (SPI) license
• Money changing license

SPI and MPI are the ones businesses get most confused between. The difference is basically about the operating payment threshold limits. Here’s a table to understand the differences better:

You can think of SPI as the entry point for smaller or newer businesses, while the MPI is where high-growth and large-scale payment businesses operate. If an SPI consistently surpasses its transaction thresholds, it is legally obligated to apply for a license variation to become an MPI.

So, if you're projecting rapid growth, it's often worth applying for an MPI from the start to avoid the time and cost of upgrading later.

As per the PSA, 2019, you must get an MPI license if you’re engaged in the following activities: 

• Account issuance: Issuing or operating a payment account, including services that allow customers to place or withdraw money from such accounts.
• Domestic money transfer: Facilitating fund transfers within Singapore, including payment gateway and payment kiosk services.
• Cross-border money transfer: Dealing with payments across the border on behalf of your customers.
• Merchant acquisition: Processing payments for merchants, so that they can accept card or digital payments from their customers.
• E-money issuance: Offering electronic money that your customers can utilize for making payments of their own.
• Digital payment token (DPT) services: Buying, selling, or facilitating the exchange of cryptocurrencies and digital tokens.

To apply for an MPI license, your business needs to meet the following criteria:

• Local company incorporation: Your business should be incorporated and registered in Singapore with the Accounting and Corporate Regulatory Authority (ACRA) before applying. You need to have a permanent place of business or registered office in Singapore where all the books and records are safely maintained.
• Minimum base capital: A minimum base capital of S$250,000 is required, along with a sufficient capital buffer apart from this amount to support your business operations, depending on their size and scope.
• Compliance officer appointment: Applicants need to have either an independent and dedicated in-house compliance function or outsource compliance to a head office or related entity that has its own independent compliance function. 
• Director requirements: At least one executive director must be a citizen of Singapore or a Permanent Resident, or alternatively, an Employment Pass holder with at least one other director who is a Singapore Citizen or PR.
• Consumer representative: At least one person must be appointed and present at the registered place of business to address any queries or complaints from consumers. 
• Fit and Proper requirement: Important people in your business, like directors, senior managers, and beneficial owners, need to have a good reputation, relevant experience, strong integrity, and a solid financial track record.

When it comes to protecting customer money, there are strict obligations for MPI holders. This includes both money being transferred and stored balances (float money).

• Safeguard customer monies: MPIs are required to safeguard customer money in respect of domestic money transfer, cross-border money transfer, merchant acquisition, and e-money issuance services. This applies to both funds in transit and e-money float.
• Use trust accounts or guarantees: They must safeguard customer funds through one of three options: obtaining an undertaking from a safeguarding institution to be fully liable to the customer, obtaining a guarantee from a safeguarding institution, or depositing the funds in a trust account that is maintained with a safeguarding institution. 
• Maintain operational resilience: MPIs are expected to put in place advanced technology risk management and cybersecurity measures, often requiring independent audits. MAS has shown increased focus in this area, particularly in relation to operational resilience and incident reporting. 
• Implement AML/CFT frameworks:  MPIs are required to have comprehensive AML/CFT systems built with dedicated compliance resources, covering customer due diligence, sanctions screening, transaction monitoring, and suspicious activity reporting.

Here’s how you can apply for your MPI license:

1. Set up your company

Start by incorporating your business in Singapore and registering it with ACRA. You can’t apply for a license until the entity is officially set up.

2. Get your policies ready

You’ll need to have with you important documents like your AML policy, risk assessment, and technology risk framework.

3. Submit your application

Applications are submitted through the MAS e-licensing portal using Singpass. This is where you share details about your business, services, compliance setup, and supporting documents with the MAS.

4. Share your financial plan

MAS requires a detailed business plan and financial model that shows how sustainable your operations are. It should have projected transaction volumes, capital adequacy, and how you plan to meet ongoing safeguarding requirements.

5. Complete fit and proper checks

Directors, managers, and beneficial owners will be assessed on their experience, reputation, integrity, and financial background.

6. Respond to follow-ups

The application usually gets processed in around 4-6 months. But if more information or clarification is required, processing can get delayed. You need to respond quickly and accurately to such queries to keep your application moving forward.

All is not over once you have your license. It’s equally important to continue meeting MAS’s requirements. So, you need to have regular reviews, maintain AML/CFT compliance, submit reports, and inform of any significant changes to your business.

You can get your MPI license anywhere between 6 and 12 months after you submit a complete application.

The exact time depends on how complex your business model is. If you’re offering DPT or crypto-related services, you’re in for a longer review period because of the additional scrutiny involved.

Your best bet is to submit a complete, well-documented application from the start and respond to MAS queries promptly.

Once you have the MPI license, here are some things you should be compliant with:

• Annual audit: Your financial statements and compliance programs need to be audited every year. MAS uses these audits to verify that your business continues to meet licensing standards.
• AML reporting: You're required to maintain and regularly update your AML/CFT program. Apart from that, you should file suspicious activity reports when needed, and make sure your customer due diligence and transaction monitoring systems are always functioning as per the requirements. 
• Technology risk management: MAS takes technology risk quite seriously. You're expected to have cybersecurity measures in place, conduct regular system reviews, and report any technology-related incidents that could affect your operations or customers.
• Regulatory returns: Licensed MPIs must submit regular reports to MAS covering transaction volumes, outstanding e-money, and other operational data. These are submitted through MAS's reporting systems on a periodic basis.
• Incident reporting: Incidents like system outages, security breaches, or fraud should be reported to MAS. You should also have a clear incident response plan ready all the time.

Crypto and digital asset businesses in Singapore face the same MPI licensing requirements as any other payment service provider, but with more scrutiny and additional obligations on top.

DPT services are regulated

Any company offering Digital Payment Token (DPT) services needs to apply for either an SPI or MPI license, depending on their transaction thresholds. 

This applies to crypto exchanges, wallet providers, and any platform involved in buying, selling, or exchanging of digital assets. 

Operating without the required license can even lead to penalties and imprisonment.

Custody implications

The amendments to the Payment Services Act now include custodial services offered by DPT service providers as a regulated activity.This means if your platform holds crypto assets on behalf of customers in any way, you are squarely within the licensing requirement.

Stablecoin frameworks are evolving

Tokens pegged to the Singapore dollar or a G10 currency can qualify as MAS-regulated stablecoins if they meet strict reserve and redemption standards. MAS keeps refining its stablecoin regulations. And if you’re in this space, you should expect requirements around reserves, audits, and redemption processes to tighten further.

Just like MPI is in Singapore, in the USA, there is a money transmitter license that allows businesses to take part in receiving and sending payments on behalf of others. It’s worth understanding how they operate and where they are different for fintech founders operating across borders.

Here’s how the MTR license  differs from the MPI license:

Meeting all MPI licensing requirements might seem gruelling at first, but once you start seeing the benefits, it becomes well worth your efforts:

• No transaction caps: You can operate at any volume without hitting monthly thresholds that would otherwise restrict your growth.

• Enhanced credibility: An MPI license signals to customers, partners, and investors that your business meets Singapore's highest regulatory standards.
• Easier banking relationships: Licensed MPIs find it significantly easier to open and maintain corporate bank accounts and secure correspondent banking relationships.

• Regional expansion readiness: Singapore's reputation as a global financial hub means an MPI license strengthens your position when entering other Asian and international markets.

• Strong regulatory reputation: Operating under MAS oversight puts your business in the same league as the world's most trusted payment institutions, giving you a competitive edge that's hard to replicate.

MPI applications that fail to meet any of the specific MAS requirements can easily get rejected. Some of the most common reasons why that happens include:

• Weak AML framework: If your AML/CFT program is underdeveloped, that's a rejection point for MAS. If your policies are thin, your transaction monitoring is inadequate, or your risk assessment isn't thorough, expect your application to stall or fail. 
• Insufficient capital: Falling short of the S$250,000 minimum base capital requirement will result in rejection. MAS wants to see that your business is financially sound before it even begins operating.
• Poor governance structure: MAS looks closely at who is running your business and how. Weak board oversight, unclear roles, or key personnel who fail the Fit and Proper assessment are all grounds for rejection.
• Incomplete documentation: Missing documents or poorly prepared compliance manuals slow down or derail applications entirely.

An MPI license is a regulatory approval that allows businesses to provide large volumes of payment services without transaction caps. It is critical for fintech, remittance, and crypto firms operating at scale in Singapore.

Singapore’s payment space is evolving fast, which means keeping up with MAS requirements will help you build a business that banks, partners, and customers actually trust, and want to stick with for the long run.

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