National Payment Systems Directives on Electronic Money Issuance, 2023 (Gazette No. 958 of 2023)

The National Payment Systems Directives on Electronic Money Issuance, 2023 are directives issued by the Bank of Zambia under the National Payment Systems Act, 2007 and published in Gazette No. 958 of 2023. They constitute the current regulatory framework for the issuance of electronic money in Zambia and superseded the earlier National Payment Systems Directives on Electronic Money Issuance, 2018. The Directives apply to all electronic money issuers, including banks and non-bank e-money issuers and mobile money operators, together with their agents and participants. They require authorisation/designation by the Bank of Zambia before issuing electronic money and set out the licensing criteria, including legal form, fit-and-proper standards for shareholders, directors and management, governance, risk-management, and operational and security capacity. A central requirement is the protection of customer funds: issuers must hold the funds received from customers in exchange for electronic money in a trust account (or accounts) at a commercial bank, fully backing the outstanding e-money float, ring-fenced from the issuer's own funds and creditors, with restrictions on how trust-account balances and any interest may be used. The Directives govern float and liquidity management, agent-network management and oversight, interoperability, customer due diligence and KYC tiers with corresponding transaction and balance limits, anti-money-laundering and counter-terrorist-financing compliance, consumer protection and disclosure (including complaints handling and fee transparency), data and system security, business-continuity, and periodic reporting to the Bank of Zambia. The Bank supervises issuers, may vary conditions and may take enforcement action, including penalties, suspension or revocation. Updating the regime to reflect market growth and risks since 2018, the 2023 Directives are the operative e-money instrument in Zambia and sit beneath the umbrella National Payment Systems Act, 2007.

1. 1Current framework for electronic money issuance in Zambia, superseding the 2018 directives
2. 2Require Bank of Zambia authorisation/designation before issuing e-money and set fit-and-proper, governance and operational criteria
3. 3Require customer funds to be held in trust account(s) at a commercial bank, fully backing the float and ring-fenced from the issuer
4. 4Govern float/liquidity management, agent-network oversight and interoperability
5. 5Impose CDD/KYC tiers with transaction and balance limits, AML/CFT, consumer protection and reporting
6. 6Confer supervision and enforcement powers, including penalties, suspension or revocation