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The Central Bank of Kuwait (CBK) has promulgated the “Instructions for Regulating the Electronic Payment of Funds” in May 2023, an update to the previous regulations that was issued in 2018, under the umbrella of “Law No. 20 of 2014 for The Electronic Transactions”
The instructions issued by the CBK shall be applied to electronic payment service providers (EPSPs), electronic money service providers (EMSPs), and all local banks. To perform any activity1, e-commerce and fintech businesses in Kuwait shall be listed in the CBK Register2 that contains the basic information submitted by them and any other information to be defined by the CBK.
This publication will help you understand...
- E-Payment Service Provider (EPSP): Any company registered to perform E-Payment Activities in the State of Kuwait in accordance with these instructions.
- E-Money Service Provider (EMSP): Any company registered to perform E-Money Activities in the State of Kuwait in accordance with these instructions.
- E-Payment Service Operator (EPSO): Any company registered to manage and operate the E-Payment systems infrastructure and its instruments in the State of Kuwait.
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- An unconditional letter of guarantee issued by a local bank in favor of CBK Financial guarantee, if necessary, according to the volume of the activity and the associated risks
- A copy of the Memorandum and Articles of Association, the Commercial Registration of the company, list of board of directors, company’s equity structure showcasing major shareholders holding >5% and percentage of their ownerships and audited financial statements by an approved auditor for a period of three financial years1
- Corporate governance structure and CFTE/AML plan
- Customer protection, Data protection and security threat plans
- Describe the procedures of the Risk Management System and the Accounting System, including the relevant reporting system
- 5-year business strategy and action plan for large EPSPs and EMSP and a 3-year business strategy for small EPSPs and EMSP.
- Key functional policies including Information Technology (incl. access, back up policy and contingency plan) Corporate governance structure and AML plan
- Risk management framework
- Risk Register covering Company functions and operations
- Finance (incl. reconciliation mechanism, dispute resolution mechanism and reports)
| Step 1: Submit the registration form electronically with all the required documents. |
| Step 2: CBK to issue an initial approval valid for six months. |
| Step 3: Completion of the registration documents. Refer to section 2 to know more. |
| Step 4: Receive the final decision of approval or rejection from CBK. |
| Business plan development and strategy advisory (including business objectives and activities, target business and operating model, SWOT analysis, key risks and exit plan) |
| Market assessment and financial feasibility study (including market potential, target customer segments and financial projections for the proposed business) |
| Valuation (independent valuations for specific client needs including transactions, tax, accounting, and financial reporting purposes) |
| Transaction services (pre-deal evaluations, financial due diligence, vendor assistance, vendor due diligence and strategic & commercial intelligence) |
| Sell-side/buy-side advisory (identify, manage and successfully complete transactions, drawing upon both our local market knowledge and international M&A network) |
| Restructuring (assisting businesses to stabilize, reorganize borrowings, enhance profitability and build a platform for sustainable growth) |
| Operations Policy & and Procedure Manual (including Dispute Management, Vendor Onboarding and Vendor & and Customer Support) |
| Internal audit services to ensure compliance with policies (mandated by select banks) |
| Anti Money Laundering (AML) and CFT Policy & Procedure Manual |
| Readiness Assessment‚ Compliance Assessment‚ Technology Risk Assessment‚ Internal Audit‚ and Post Implementation Review. |
| Information Technology Policy & Procedure Manual (including the Back Up Policy) |
