Palestine Monetary Authority

PALESTINE MONETARY AUTHORITY

Instructions No. (3) of 2021

Regarding the Provision of Electronic Wallet Services by Payment Service Companies

Based on the provisions of Legislative Decree No. (17) of 2012 concerning the National Payments Settlement Law, particularly Articles (5) and (9) thereof,
and based on what was approved by the Board of Directors of the Palestine Monetary Authority in its meeting No. (236) dated 23/06/2021,
and in pursuit of the public interest,
we have issued the following Instructions:

Chapter One

Definitions and Scope of Application

Article (1)

Definitions

The words and phrases contained in these Instructions shall have the meanings assigned to them below, unless the context indicates otherwise:

• Authority: The Palestine Monetary Authority.
• Electronic Wallet: An electronic service that converts cash into digital balances to execute payment, receipt, and fund transfer transactions.
• Sub-Wallet: An electronic service branching from the Electronic Wallet.
• Electronic Wallet Account: An account opened with the Service Provider.
• Service Provider: The company licensed by the Authority to provide the Electronic Wallet service.
• Payment Order: Instructions from the Payer to the Service Provider requesting the execution of a payment transaction.
• Person: Natural or legal person.
• User: The person who uses the Electronic Wallet as a Payer or Beneficiary.
• Payer: The person issuing the Payment Order through the Service Provider.
• Beneficiary: The person receiving the funds of the Payment Order through the Service Provider.
• Agent: The person entrusted to act on behalf of the Service Provider in providing all or part of the services the Service Provider is licensed to provide, according to their agreement.
• Account Funding: Depositing cash funds into the Electronic Wallet account.

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Article (2)

Objective and Scope of Application

1. These Instructions aim to regulate Electronic Wallet service operations in a secure and transparent manner.
2. The provisions of these Instructions apply to all companies licensed to provide the Electronic Wallet service.

Chapter Two

Electronic Wallet

Article (3)

Account Opening

1. The Service Provider must, when opening an electronic wallet account for a User, comply with the following:

   • a. Take all due diligence procedures in accordance with applicable laws, regulations, and instructions when opening the account.
   • b. Open the Electronic Wallet account for the User based on a written request.
   • c. Verify the original documents related to the account opening request and match them with the registered data.
   • d. Verify that the name of the account opening applicant is not listed on the anti-money laundering and counter-terrorism financing blacklist.
   • e. Not specify an expiration date for the wallet.
   • f. The wallet value must equal the value of cash received from the User, and no interest or returns may be granted on the existing balance.
   • g. Obtain all information contained in Annex No. (1).

2. Notwithstanding the provision in paragraph (1/b) of this Article, the Service Provider may open a temporary electronic wallet account for a period not exceeding (60) sixty days through electronic means and under terms agreed upon in writing by the Authority, with the account being cancelled upon the expiry of this period unless there is a balance in the wallet account.

3. The temporary electronic wallet is exempt from the requirements stipulated in paragraph (1/d) of this Article, provided that no funds are deposited into the temporary wallet account before fulfilling these requirements.

4. The Service Provider is prohibited from opening an account via electronic means a second time for the same person if they do not sign a written request to open the account within the period stipulated in paragraph (2) of this Article.

5. The User is allowed to open only one account with the same Service Provider.

6. More than one sub-wallet may be opened from the Electronic Wallet account under the following conditions:

   • a. The sub-wallet belongs to a minor who is a first-degree relative of the User.

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Article (4)

Electronic Wallet System

1. The Service Provider must comply with the following:

   • a. Manage, store, and retrieve records and transactions executed on the Electronic Wallet.
   • b. Securely link operations provided through the Agent to ensure immediate execution on the User's account.
   • c. Protect and process payment orders issued by the User.

2. The Authority may inspect the system or appoint a third party to do so at the Service Provider's expense to ensure compliance with any conditions and requirements and to verify the integrity of operational processes in accordance with these Instructions.

Article (5)

Financial Guarantees for Electronic Wallets

The Service Provider must provide any of the following financial guarantees covering the full value of issued Electronic Wallets, subject to the Authority's approval, before providing the service:

1. A cash deposit with the Authority.
2. A bank guarantee issued by one of the banks licensed to operate in Palestine upon request, in favor of the Authority, which renews automatically.
3. A bank check issued by one of the banks licensed to operate in Palestine in favor of the Authority.

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Article (6)

Funding and Withdrawal

1. The Service Provider must comply with the following:

   • Subject all Electronic Wallet account funding methods to procedures that allow verification of the account owner's identity before accepting funding or withdrawal transactions, and funding the Electronic Wallet account is prohibited except by the account owner or their authorized representative.

2. Restrict the execution of Electronic Wallet funding or withdrawal transactions within Palestine.

3. Ensure sufficient cash liquidity with the Agent to cover expected cash withdrawal transactions.

Article (7)

Transfers Between Accounts

1. Financial transfer transactions between accounts of Electronic Wallet service Users with Service Providers licensed to operate in Palestine must be conducted.

2. Financial transfers may be made from the User's Electronic Wallet account to the User's bank account and vice versa, provided that the bank account is opened with a bank licensed by the Authority.

Article (8)

Caps on Payment, Withdrawal, and Transfer Transactions

1. The Service Provider must comply with the User account caps determined by the Authority in accordance with Annex No. (2) and subsequent instructions issued by the Authority regarding this matter.

2. The contractual relationship with the following entities is exempt from paragraph (1) of this Article, governed by special agreements:

   • a. The Principal Agent account.
   • b. The Merchant account linked to the Electronic Wallet service.
   • c. The Electronic Voucher Issuer account linked to the Electronic Wallet service.
   • d. Any other entity approved by the Authority.

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Article (9)

Repeal

1. Instructions No. (1) of 2020 regarding the Provision of Electronic Wallet Services by Payment Service Companies are hereby repealed.
2. Any provision conflicting with the provisions of these Instructions is hereby repealed.

Article (10)

Implementation and Enforcement

All competent authorities shall, each within their respective jurisdiction, implement the provisions of these Instructions, which shall apply from the date of their issuance.

Issued in the city of Ramallah on 30/06/2021 AD

Dr. Firas Malham
Governor
(Signature)

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Annex No. (1)

Data and Information Required for Account Opening

The following is the minimum data and information required to be available in the Electronic Wallet account opening request form:

1. The following User information:

   • a. National ID number or the number of the identity document recognized in Palestine for a natural person, or the registration certificate for a legal person.
   • b. Full name (four-part name).
   • c. Place of residence.
   • d. Occupation.
   • e. Copy of the identity document.
   • f. Mobile phone number registered with any of the telecommunications companies licensed to operate in Palestine.
   • g. User's signature on the general terms and conditions for account opening.

2. Conditions and procedures for freezing, reactivating, and closing the account.

3. Declaration from the account opening applicant that they are the original owner and sole beneficiary of the account opening.

4. Annex detailing the account cap and permitted transactions through the Electronic Wallet.

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Annex No. (2)

Financial Caps

The caps for financial transactions related to the User's account in all currencies are as follows:

1. The maximum cap for the User's account at any time is USD 4,000 or its equivalent in other circulating currencies.

2. The maximum total of all payment and transfer transactions monthly using the User's account is USD 4,000 or its equivalent in other circulating currencies.

3. Funding the User's account and transfers to it is USD 4,000 monthly or its equivalent in other circulating currencies.

4. Cash withdrawal from the User's account is a maximum of USD 1,000 monthly or its equivalent in other circulating currencies.

5. Services provided to the User for the temporary Electronic Wallet account as stated in paragraph (3) of Article (2) are limited to funding the Electronic Wallet with a cap of USD 300 or its equivalent in other circulating currencies for use in purchase transactions only.

6. The maximum cap for the sub-wallet account is USD 500 monthly or its equivalent in other circulating currencies, which is considered part of the cap of the parent Electronic Wallet, and the maximum for cash withdrawals and all payment and transfer transactions is USD 500 monthly or its equivalent in other circulating currencies.