BCU Tightens Regulations on Gambling Transactions in Uruguay

The Central Bank of Uruguay (BCU) has broadened its regulatory framework to encompass Payment and Collection Service Providers, aiming to prevent transactions related to gambling and illegal betting from being processed through their services.

In this context, article 171.1 (Prohibitions) has been added to the fourth part of Book IX of the Compilation of Payment System Standards. This article mandates that “Payment and Collection Service Providers must have adequate prevention mechanisms to avoid money transactions associated with gambling and illegal betting of any kind being channeled through them.”

This regulation, already applicable to Electronic Money Issuing Institutions (IEDEs), seeks to enhance user protection within a solid, efficient, innovative, and accessible payment system. By extending this framework, the BCU ensures that all relevant service providers adopt necessary measures to prevent illicit transactions.

The BCU’s official statement emphasized the importance of these measures, particularly given the prevalence of traditional and emerging methods of money laundering in the gambling sector. Popular service providers in Uruguay, such as Abitab and RedPagos, will now be required to implement stringent anti-money laundering (AML) and counter-terrorism financing (CTF) mechanisms.

“Payment and Collection Service Providers must have adequate prevention mechanisms in place to prevent money transactions associated with gambling and illegal betting of any kind from being channeled through them,” reiterated the BCU in its statement, based on the newly incorporated article 171.1.

The BCU also highlighted that the existing legal framework deems the provision of online gambling and betting services illegal unless authorized by the competent authority. This framework extends to internet-based services, technological platforms, and computer applications, underscoring the necessity of prohibiting unauthorized transactions.

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In addition to regulatory measures, Uruguay is embracing technological advancements in payment systems. Mastercard recently announced the implementation of its global biometric payment program in Uruguay. This initiative, in collaboration with partners like Ingenico, Fujitsu Frontech, Fulcrum Biometrics, and Scanntech, will pilot a palm-based payment system at Tienda Inglesa’s Red Expres stores. Shoppers can register their biometric data and payment credentials on-site and make payments by placing their hand over a sensor at the terminal.

Source: Banco Central del Uruguay DIRECTORIO – RESOLUCIÓN R.N°:D-197-2024 [pdf], Montevideo, 3 de julio de 2024.