According to its new law, the central bank is obliged to regulate the country’s payment system and regulate the field of cryptocurrencies and exchange supervision and the development and regulation of new financial technology (Fintech) active in the field of money transfer and payment instruments
It seems that the tasks and powers granted to the central bank by the new law have paved the way for the implementation of fintech mapping and regulation in this area. However, the regulatory method and change in its nature are not mentioned in this law, and it is likely that the central bank will not change the regulatory method of innovative fields and fintechs.
According to the Iran digital economy annotation, the new law of the central bank has taken a 12-year path until its approval. From the bills of the 9th, 10th and 11th government that did not go to the parliament until this December when the new law of the Central Bank was finally approved and promulgated.
Last year, this plan in 67 articles was approved by parliament members before the budget bill was reviewed. However, disputes caused this plan to go back and forth between the Parliament and the Guardian Council for 4 times, and finally, in the middle of December this year, the plan of the central bank was approved and the law of the central bank was changed.
Today, the central bank has reached the most powerful time since its establishment. This power, which was created from the change in the structure of the Money and Credit Council, has created a new structure called the Supreme Board, and instead of the Money and Credit Council, it has been replaced by the Supreme Board, and out of 10 voters in this board, 7 votes for the members.
It is the central bank. However, the regulatory limits of the central bank in the field of payment systems and fintechs will continue as in the past, and according to many, expanding the powers and defining the scope of the central bank’s activities will not lead to accepting the risks of innovative fintech models. Rather, there is a possibility that this field will become more limited.
However, the change in banking supervision methods is one of the most important aspects of the new law of the central bank. In this law, branch supervision has been canceled and the supervision of bank branches will be done in a systematic way. It seems that the use of technological capacities in the monitoring sector is one of the most important manifestations of the central bank’s attention to new financial technologies.
This law can greatly reduce the technological gap between banks and the central bank in the field of supervision and reveal the weaknesses of the current supervision method. Also, in the new law of the central bank, the use of the capacity of private companies to supervise the banking system is mentioned, and for the first time, the private sector is supposed to cooperate with the central bank in the field of supervision.
But the most important and special part of the new law of the Central Bank for the country’s innovation ecosystem is the granting of the authority to regulate emerging areas. In fact, the regulation of the country’s payment system and regulation in the field of cryptocurrencies and monitoring of exchange and expansion and regulation of new financial technology (Fintech) active in the field of money transfer and payment instruments have been entrusted to the Central Bank in the new law.
Although the central bank has been regulating emerging fields and fintechs before, or in other words, monitoring and controlling businesses in this field, in this law, for the first time, it has obtained the legal authority to regulate and regulate the field of fintechs. This legal authority can bring the implementation of the central bank’s roadmap, which is the comprehensive program of the central bank’s new technologies deputy for fintechs, closer to becoming operational. On the other hand, it has eliminated the disagreement about the responsibility of different sectors in the fintech fields.
In the new law of the central bank, also in the area of authority, the central bank is responsible for issuing all kinds of banknotes, muskox and digital money (digital) of the central bank.
In the fourth chapter of this law, the scope of supervision of the central bank is expected to increase. It is stated in paragraph C of this chapter: “Companies providing information technology services and managers of operational systems of credit institutions are obliged to apply the rules for calculating the prudential indicators of this article and other matters announced by the Central Bank in the operational systems of credit institutions.”
Also, managers of companies that provide information technology services to credit institutions and managers of their operating systems who violate the execution of the ruling of this paragraph and other regulatory requirements of the Central Bank, will be sentenced to fourth-degree punishments under Article (19) of the Islamic Penal Code. Accordingly, the supervision of the central bank in the new law will be accompanied by information and communication technology, and systemic supervision will replace traditional supervision.
Finally, it is stated in this article: Institutions active in the mentioned fields are considered “persons under the supervision of the Central Bank” and their establishment and activity are subject to obtaining a license from the Central Bank. Also, these institutions are obliged to provide all their information, statistics and documents according to the Central Bank’s request, in the order desired by the Central Bank.
Based on this, “supervised persons” is the most important provision in the Central Bank Law, which has formulated activities in emerging fields and financial technologies based on the approval of individuals and has refused to accept business models. It seems that the stipulation of “supervised persons” in the scope of the inclusion of people to obtain a license in innovative fields created ambiguities.
Despite all this, the new law of the central bank has been able to reduce the shadow of multiple decision-making institutions in emerging areas and move towards a single regulatory body for the central bank.
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