e-wallet and e-payment service providers can now apply to distribute capital market products online

The Securities Commission Malaysia (SC) will facilitate the online distribution of capital market products such as unit trusts, through e-Services platforms like e-wallet or e-payment service providers.

The Guidelines on Recognized Markets has been amended to introduce a new chapter on “e-Services platform”, which contains the registration requirements and ongoing obligations for e-Service providers.

In a statement on May 5, the SC said the amendment will allow operators of e-wallet or e-payment applications to partner with Capital Markets Services Licence holders to distribute capital market products to investors.

E-wallets or e-payment operators which are currently subject to the oversight of another sectorial regulator will be required to obtain the prior approval from the said regulator before submitting their application to the SC.

“The SC will continue to facilitate the development of innovative digital solutions to improve access to investments for all participants of the Malaysian capital markets,” said SC chairman Datuk Syed Zaid Albar.

“The introduction of the e-Service platform framework will facilitate the wider distribution of capital market products through digital platforms which are already familiar to our investors,” he added.

The SC had stated during its virtual press conference on 16 April 2020 that it observed an increase in the number of online trading accounts being registered. At the same time, there has also been a shift among licence holders towards using digital channels to distribute capital market products and services.

Interested operators will have to register with the SC as a recognised market operator (RMO) and may submit their applications from May 5 onwards.

Further queries can be directed to rmo@seccom.com.my.