Law of Ukraine “On payment services”
The new Law of Ukraine “On Payment Services” (“the Law”) aimed to facilitate integration of the Ukrainian payment market into the European payment market, came into force at the end of 2022.
In our Legal Digest, we have already made a brief mention of the adoption and enactment of the Law. Below is a brief overview of major new developments.
The Law entered into force on 1 December 2022. However, certain provisions that impose the obligation to notify the NBU of significant operational incidents, cyber incidents, and security incidents related to payment services and that regulate the implementation of open banking will take effect in a year and in three years, respectively. Until now, the NBU has already adopted a number of bylaws and is further revising its regulations to refine the provisions of the Law.
The law extended a set of payment service providers (PSPs) and distinguished non-financial services—payment initiation and account information provision—from financial payment services. We believe that extending the set of PSPs will step up activities in the financial services market and attract new participants.
The Law focuses on operational risks, cyber risks and security risks associated with payment services. Thus, payment service providers must implement and adhere to internal rules for effective reduction and control of these risks.
In addition, we find advantageous the implementation of Open Banking where financial institutions that maintain customer accounts are obliged to provide permanent access to their customers' accounts and financial information—the consent of customers is required—to other PSPs (to become effective in three years). The new changes enable PSPs to develop new services (applications), which will consolidate information from different PSPs in one place, for their customers and allow them to exchange customer information in real time.
Further, we hope that the implementation of a regulatory platform for testing payment services, technologies and tools based on innovative technologies will attract investments to Ukraine and encourage payment market participants to develop innovative solutions.
You can find a more detailed description of important novelties in the Law attached hereto.
Our team has a significant experience in consulting financial institutions on a wide range of issues, including licensing, drafting/revising internal documentation, and is ready to render assistance at your request.
The Deloitte overview indicated above is solely informative by nature and should not be treated as an official advice without a separate engagement of our professionals.
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