The Parliament today passed a government-sponsored bill to amend the law, granting the Maldives Monetary Authority (MMA) the power to designate a specific system among those currently used in the Maldives as the "National Payment Switch."

Submitted on behalf of the government by Hulhudhoo Constituency MP Mohamed Shahid, the bill was passed at today's sitting of the Parliament with the unanimous vote of 66 members present. 

According to the introduction of the bill, its purpose is to establish principles regarding the setup and operation of a National Payment Switch to further strengthen and develop the financial infrastructure of the Maldives. The bill incorporates principles into the National Payment System Act.

Therefore, the bill proposes adding an article following Article 15 of that Act. Under this article, the authority (MMA) will receive the power to designate a specific system within the national system of the Maldives as the National Payment Switch.

Consequently, payment transactions determined by the authority in regulations made under the law must be processed and routed through the payment system designated as the National Payment Switch.

When this amendment to the law was passed, the payment system currently prioritized by the government was "Favara." Neighboring India's payment system "UPI" was also recently integrated with Favara. Interbank transactions within the Maldives are also processed through Favara.

According to the bill, once these changes are brought to the law, all payment service providers in the Maldives must participate in the system designated as the National Payment Switch within a time-frame specified in regulations made under the law.

However, MMA will grant permission to payment service providers to operate under transitional arrangements during the phase of transitioning to this system.