National Payment System (Amendment) Bill, 2023 voted in favour |28 September 2023

At the end of a whole day of discussion yesterday, the National Assembly approved the National Payment System (Amendment) Bill, 2023.

Twenty (20) members voted in favour of the bill as amended while eight (8) abstained.

It was Vice-President Ahmed Afif who presented the amendments to the bill.

VP Afif was accompanied by the Governor of the Central Bank, Caroline Abel; director of Legal Unit at the CBS, Shanon Jolicoeur; senior financial surveillance analyst, Cyril Benoiton; and senior legal draftsman, Victor Pool.

This bill seeks to amend the National Payment System Act. In making these amendments, the bill addresses certain deficiencies which impeded, to some extent, its effective regulatory and oversight functions. As such, this bill provides amendments that address the deficiencies and align the legislation with international standards and best practices.

VP Afif spoke about the various steps taken by the government since 2008 in the financial system and the different methods of payment introduced.

“Since the National Payment Act came in force in 2014, we have evolved in our payment systems and this is the reason why I came with the Governor of CBS and the officers to present the amendments in the law. CBS has taken into account the shortcomings in the administration of this law and also the developments that have happened in Seychelles and on the international standard.”

VP Afif explained that this bill makes provision for the Central Bank of Seychelles to be able to determine the use or acceptance of any form of payment instruments including the imposition of a limit on the value of transaction to be used. This is aligned with the Central Bank of Seychelles' plan to modernise the country's National Payment System (NPS). Consistent with guidance issued by standard setting bodies, the bill also provides for the exemptions to Central Bank of Seychelles in relation to certain requirements as it discharges the functions of owning fully and operating payment, clearing and settlement systems. Likewise, in the absence of a national netting law, the bill makes provision for legal recognition of netting arrangements within the payments transactional cycle.

The bill further puts forth amendments serving to align certain provisions relating to confidentiality, inspections, record keeping and archiving etc. with that of the Financial Institutions Act, 2004 as amended (FIA). Additionally, proposal is being made for the Central Bank of Seychelles to be granted the power to designate those financial market infrastructure or payment instruments which are deemed to be of systemic importance.

Ultimately, the proposed amendments aim to strengthen the Act so as to ensure the safety, soundness, effectiveness and efficiency of Seychelles' NPS.

Most of the interventions from the members of the National Assembly suggested for more communication and awareness first for the members of the National Assembly before the amendments are brought forward to the NA.

Clifford Andre, chairperson of the Bills Committee and elected member for the district of Anse Aux Pins, noted the importance of these amendments in putting Seychelles at par from other countries and also the country is abiding by international regulations and standards.

John Hoareau, elected member for Beau Vallon spoke about the importance of ensuring security while doing financial transactions.

Wallace Cosgrow, also a member of the Bills Committee, said even though there was an interaction with the sponsors of the bill, it was minimal and many of the MNAs are not at ease with technical terms of the bill. “Definitely we need more interaction. With this law CBS has the ability to regulate the financial institutions but they also have to look into how to pass on the benefits to the customers.

Leader of the opposition, Sebastien Pillay, shared his disappointment over the fact that there were not enough consultations on the amendments of the law.

“In 2014, we got a detailed presentation by the CBS and now in 2023 we have a more technical law and we have not yet heard the maximum amount that can be transacted so far. It is important for us to understand how far CBS will go.”

Hon. Pillay also shared his concerns about the security of the system and how the law guarantees this protection and hopes for more education and awareness campaign on the law.

Several other members spoke about the law and the technicalities involved. CBS representatives were able to clarify all the queries from the MNAs.

Once again, in the first part of the Assembly sitting, the proportionate member for United Seychelles, Johan Loze, was instructed to leave the session by Speaker Roger Mancienne.

Vidya Gappy