Latest Payments News: Lithuania Plots Dramatic Reduction In Payment Service Fees

Catch up on six of the stories our payments compliance analysts have covered lately, and stay up-to-date on the latest news.

Lithuania Plots Dramatic Reduction In Payment Service Fees

Lithuania’s government has approved new amendments to the Law on Payments that will reduce payment service fees by almost one-third.

The amendments will cap the commission that banks can charge for payment services at about €1, down from the current rate of €1.47, and the cap will be in place for three years.

The amendments were prepared by the Ministry of Finance and the Bank of Lithuania in response to reports from commercial banks that customers are increasingly opting to withdraw cash rather than use bank payment services.

The Ministry of Finance said it estimates that the amended law will come into effect on January 1, 2025, although this is still to be decided by parliament.

New Central Bank, AI Partnership To Kick Off Open Finance In UAE

Al Etihad Payments (AEP), a subsidiary of the Central Bank of the United Arab Emirates (CBUAE), has signed a partnership with Core42, an AI enablement solutions provider.

The partnership aims to kickstart the implementation of open finance in the UAE, one of the nine initiatives of the CBUAE’s Financial Infrastructure Transformation (FIT) Programme.

“The implementation of Open Finance marks a significant advancement in the UAE’s financial services industry and its financial infrastructure transformation,” said Fatma Al Jabri, assistant governor at the CBUAE.

“It will accelerate the adoption of digital financial services, providing more innovative and safer digital financial products and services in the country.”

The UAE is the first country globally to implement a consolidated trust framework and centralised application programming interface (API) hub.

This will enable a single secure connection to all banking and insurance markets for regulated third parties, with access conditional on customer consent.

RBI Shuts Down Major Indian Bank Due To 'Serious' Compliance Concerns

The Reserve Bank of India (RBI) has issued a cease and desist order to Kotak Mahindra Bank, one of the country’s largest credit card issuers.

The order prevents Kotak Mahindra from onboarding new customers through its online and mobile banking channels, and prevents it from issuing new credit cards.

The RBI said the action was necessary due to “significant concerns” arising from a regulatory examination of the bank’s IT systems for 2022 and 2023.

The central bank highlighted Kotak Mahindra’s “continued failure” to address “serious deficiencies” in the management of its IT inventory, user access, vendor risk, data security and business continuity.

FTC Announces Rule Banning Noncompetes

The US Federal Trade Commission (FTC) has issued a final rule to promote competition by banning noncompetes nationwide, protecting the fundamental freedom of workers to change jobs, increasing innovation and fostering new business formation.

A noncompete is a clause under which one party agrees not to enter into or start a similar profession or trade in competition against another party, typically their employer.

“Noncompete clauses keep wages low, suppress new ideas and rob the American economy of dynamism, including from the more than 8,500 new startups that would be created a year once noncompetes are banned,” said FTC chair Lina Khan.

“The FTC’s final rule to ban noncompetes will ensure Americans have the freedom to pursue a new job, start a new business, or bring a new idea to market.”

The FTC estimates that the final rule will lead to new business formation growing by 2.7 percent per year, resulting in more than 8,500 additional new businesses created each year.

The final rule is also expected to result in higher earnings for workers, with estimated earnings increasing for the average worker by an additional $524 per year.

UAE Should Stay On High-Risk List, Say EU Lawmakers

The European Parliament has approved a motion for a resolution to object to a European Commission regulation that would remove the United Arab Emirates (UAE) and other countries from the EU’s list of high-risk third countries.

The list is made up of countries that are perceived to have deficient anti-money laundering and counter-terrorist financing (AML/CTF) regimes.

The move comes in spite of the UAE being removed from the Financial Action Task Force's greylist earlier this year.

The motion also calls for Gibraltar to remain on the EU's high-risk list.

Volt Instant Payments Solution Goes Live In Australia

Volt has announced that its new instant payments solution that uses Australia’s New Payments Platform (NPP) is now live.

The solution allows retail customers to pay for goods and services instantly using PayTo, the addressing system of the NPP, which can be accessed through the customer’s bank app.

Volt said the solution will simplify retail payments and eliminate merchant surcharges — a key pain point for Australian consumers. For merchants, receiving payments via PayTo on the NPP also allows for instant settlements.

“Volt's one-click payments are an example of a solution that benefits all parties,” said Jordan Lawrence, co-founder and chief growth officer at Volt.

“It offers Australian consumers access to smoother, easier, faster payments at checkout, while Australian merchants can enjoy faster settlement times and eliminate risk and fraud.”

‍

Want to know more?

‍Request a demo with one of our experts today to gain full access to the stories we cover - and much more - and start learning how you can make compliance a competitive advantage for your organisation.

‍

‍