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How to register a payment system (PS) in Labuan

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Registering a payment institution in Labuan in 2020

Pros of opening a payment system in this jurisdiction:

  • Developed financial services sector;
  • 100% foreign ownership is possible;
  • There are no requirements for the payment of VAT, capital gains tax, and tax on profit repatriation;
  • Relatively simple conditions for obtaining a license in order to provide payment services.
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The idea of ​​registering a payment system is aimed at cashless transactions (using a debit card, a credit card, the online banking).

There are two types of PS models in Labuan, which are:
  • a single payment merchant system (SPMS);
  • the collective payment merchant system (CPMS).
Model 1: registering the SPMS in Labuan

Such registration allows the Merchant to provide the Client with more options for paying services both online/offline. As a result, it is possible to reduce labor costs, risks of loss or theft, since a cash is not present in circulation.

Model 2: opening a Labuan CPMS

Registering a financial institution connects the Client with the Seller's Partners (Merchant) in his community. A system unites all sellers in the community, using the principle of electronic wallets. It helps to increase sales and expand the customer database.

Registering a payment system in Labuan. A taxation

If you decide to obtain a license in Labuan, you should consider the following nuances:

  • no need for local Malaysian partners;
  • 3% tax or a flat fee of approximately $5,000 from trading profits;
  • a zero tax on the repatriation of income from interest, royalties and from management/maintenance fees;
  • no state duty, VAT;
  • no tax on sales and services;
  • no capital gains;
  • no dividend tax;
  • 70 double taxation treaties of Malaysia;
  • 50% tax reduction for foreign specialists;
  • no taxes for foreign and local directors;
  • the possibility of obtaining a multi-entry work visa for 2 years with the possibility of staying and working in Malaysia.
A commercial component for the tax transparency of your business

Since the costs of operating activities in Labuan are very low (the office rental, a hiring staff, professional legal services), we advise clients, who want to obtain a license for the payment system in Labuan, to use these advantages to prove the transparency of the business. Thus, with the help of evidence of a commercial component, your business will comply with CRS standards.

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Qualification requirements

To apply for a payment system license in Labuan, the following conditions must be observed:

  • The company must have positive financial statements for three years and have a new model of the payment system (you can check with our company specialists in more detail).
  • The company must be with an existing payment system (in case of transfer of the business to the Malaysian region).
  • A proof of the capital in the amount of $100,000.
Stages of the organization of the payment system
  • A preliminary approval of the business model with the Financial Services Authority of Labuan.
  • The consideration of an application for a license for a payment system in Labuan (term 1,5-2 months).
  • A company registration in Labuan.
  • The organization of a physical office.
  • Opening a bank account in Labuan.
How to get a payment system license in Labuan?

Contact IQD Consulting team for a payment system license in Malaysia. You will receive step-by-step a support and qualified assistance in the design of a promising and profitable business in Labuan.

Our company shall not be liable for any direct, indirect or consequential loss arising from the use of the information and material contained in this website.

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