October 2015 has seen the commencement of implementation of the Payment Services Act (the Act), which was enacted by the Parliament in 2014. The Act replaced the Payment Transactions Act with the exception of provisions governing enforcement proceedings which will continue to be performed in accordance with the provisions of the Payment Transactions Act. Two main game-changing possibilities have been introduced by this piece of legislation.
The Act establishes a new Universal Registry of Natural and Legal Persons’ Accounts (the Registry) that will be managed by the National Bank of Serbia (the NBS). The Registry will include information on when an account is established, terminated, the amount of turnover, as well as information regarding the client. However, no information on account balance and changes thereto will be available at the Registry. The purpose of the Registry is to facilitate easier enforced collection of debt, so that enforcement officers will be able to obtain injunctions against disposal of funds on personal bank accounts. Since information on natural persons will not be made publicly available, and are protected under the personal data protection legislation, NBS will authorize access thereto only upon written requests of the Ministry of Interior, courts, public prosecutors, the Tax Administration, Administration for the Prevention of Money Laundering, and enforcement officers.
New business opportunities have also been made available in the (electronic) payments sector. The Act introduces two new categories of payment service providers – payment institutions and electronic money institutions.
The new legislative framework allows companies not incorporated under the Banking Act to issue electronic money (also a novelty in the national payment system) as well as to provide services for facilitating transactions with money orders, transfer of funds between accounts, and issue payment instruments including payment cards as well as a number of services that have until now been reserved market for banks and the postal service. The prospective payment institutions will be required to file for a license from the NBS, and one of the main conditions will be the amount of their share capital (from EUR 20,000 to EUR 125,000 depending on which activities they wish to engage in).
Electronic money institutions may be operated exclusively by companies having a license from the NBS (among the required conditions is that the amount of share capital may not be lower than EUR 350,000). Along with issuing electronic money, electronic money institutions may also perform other operations including, but not limited to, granting loans in connection with payment services. Electronic money institutions may not approve such loans from funds received for the issuing of electronic money.
Establishment of the Registry and the required high amounts of minimum share capital are a result of the legislator’s intention to protect users of financial services and to maintain strict control over the country’s financial system.