Labuan: Labuan Financial Services Authority (Labuan FSA) has tightened regulatory requirements for digital money broking activities in the Labuan International Business and Financial Centre (Labuan IBFC) to strengthen market integrity and operational resilience. Its director general, Affendi Rashdi, announced that the enhanced framework places greater emphasis on governance, compliance, technology, and operational controls, particularly in addressing risks associated with digital financial activities.

According to BERNAMA News Agency, the move aims to ensure that innovation within Labuan IBFC develops alongside appropriate regulatory safeguards. Affendi Rashdi highlighted the necessity for regulation to keep pace with the digitalisation of financial services. 'Our goal is to enable innovation within Labuan IBFC, but with the right safeguards to keep the market resilient and trusted,' he stated in a press release.

Labuan FSA initially introduced a regulatory framework for digital currency trading in 2024, followed by tighter oversight of digital money broking platforms in 2025. This latest enhancement is part of the authority's broader regulatory reforms covering digital governance, market supervision, and electronic know-your-customer (e-KYC) requirements.

Affendi Rashdi emphasized that clearer regulatory standards would provide industry players with greater certainty while ensuring that innovation does not compromise the integrity of the financial market. 'The message to the industry is simple: innovate, but innovate responsibly,' he added.

Labuan FSA plans to continue strengthening prudential measures while supporting responsible digital innovation as part of efforts to position Labuan IBFC as a resilient and future-ready international financial centre.