The Bank of Botswana says amendments to Electronic Payment Services (EPS) regulations are in operation, covering an expanded scope of application, interest for electronic money balances as well as adjusted fines, amongst others.
In a statement last week, the central bank said the amendments came into effect on April 2 and were introduced in response to developments in EPS and Money or Value Transfer Services (MVTS) sector, as well as broader changes within the national payments systems.
The regulations align the regulatory framework with the re‐enacted Financial Intelligence Act, 2022 and the related subsidiary legislation and the Bank of Botswana (Amendment) Act, 2022, while also addressing relevant Financial Action Task Force (FATF) requirements, as well as operational, supervisory and regulatory challenges raised by industry stakeholders.
Key amendments include greater clarity regarding the entities that may be licensed to offer EPS in Botswana, adjustment of penalties to align with broader financial crime legislative framework as well as the introduction of interest-bearing electronic‐money balances to support product innovation while maintaining prudential safeguards.
According to the regulations, a person shall not operate an EPS in Botswana without licence from the BoB, with the penalty set at P1 million and or five years imprisonment. Unlike the previous regulations which required licencees to use any interest earned on electronic money balances for account maintenance and promotion of financial inclusion, the amendments allow licencees to pay the interest to customers based on their balances.
The BoB says the change is intended to support product innovation, while maintaining prudential safety guards.
