FIAU, MFSA offers new guidance doc for institutions opening accounts for fintechs

A Guidance Document for Credit Institutions, Payment Institutions and Electronic Money Institutions opening accounts for fintechs has been published by the Malta Financial Services Authority (MFSA) and the Financial Intelligence Analysis Unit (FIAU), according to a press release the MFSA published on its website.

The guidance supports and aims safeguarding the integrity of the financial market, the MFSA says.

The document intendeds to assist institutions that want to acquire a better understanding of the risks of any prospective customers, active in technology reliant areas, prior to servicing them.

Nevertheless, the MFSA warns it is not intended to be binding and neither does it provide any derogation from any obligations that a subject person has to fulfil in terms of the Prevention of Money Laundering and Funding of Terrorism Regulations (PMLFTR), according to the press release. 

On the contrary, it seeks to provide additional assistance as to how adherence thereto can be achieved when a prospective customer carries out particular activities.

Therefore, according to the MFSA, it is crucial that the guidance document is read together with the implementing procedures and any other relevant guidance document issued by the FIAU, as well as within the more general context provided by the Prevention of Money Laundering and Funding of Terrorism Regulations (PMLFTR). 

The authorities, in fact, encourage affected institutions to take this document into consideration when formulating their risk assessment measures, controls, policies and procedures.

“The MFSA is well aware of the need to strike a delicate balance in this area. We cannot attract new business in financial technology if such companies do not find the required banking services,” said Christopher P. Buttigieg, Chief Officer Strategy, Policy and Innovation at MFSA. “At the same time, we understand that banks operate on risk-based priorities and need to follow strict regulatory standards. Whilst it is not our role to set banks’ risk appetite, we can facilitate business as much as possible by clarifying our expectations to all operators in these emergent sectors,” he added.