REGULATION & LICENSING
Licensed to operate. Audited to be trusted.
Kaadxpay operates as a licensed Payment System Operator under the Labuan Financial Services Authority (LFSA), Malaysia.
PRIMARY LICENSE
Labuan FSA Payment System Operator
Granted on 16 January 2026, our PSO license authorizes Kaadxpay Financial Solutions Pty. Ltd. to operate cross-border payment services from the Federal Territory of Labuan, Malaysia, under the Financial Services Act 2010 and Labuan Financial Services and Securities Act 2010.
- Authority
- Labuan Financial Services Authority (LFSA)
- License type
- Payment System Operator (PSO)
- License number
- LFSA.700-14/LFA/PS/25/2026 (3)
- Issued
- 16 January 2026
- Scope
- Cross-border payment services — collections, payouts, FX, settlement
REGULATORY FRAMEWORK
Built on globally-recognized standards.
Financial Services Act 2010
Malaysia's primary financial services framework. Governs payment services, capital adequacy, governance, and consumer protection.
Labuan FSSA 2010
Labuan-specific framework providing regulatory clarity for cross-border financial services with international standards.
FATF 40 Recommendations
Our AML/CFT program is built on FATF 40 — the global standard followed by 200+ jurisdictions.
FATF Travel Rule (R.16)
Cross-border transactions above threshold include sender/recipient data per FATF Recommendation 16.
COMPLIANCE PROGRAM
Five pillars of regulatory operation.
KYC/KYB
Tiered customer due diligence with enhanced due diligence (EDD) for high-risk customers and corridors.
AML monitoring
Real-time sanctions, PEP, and adverse media screening. Behavioral transaction monitoring with ML + rules engine.
Suspicious + cash reporting
STR and CTR generated and submitted to LFSA per regulatory thresholds and timelines.
Independent audit
Annual financial audit and AML compliance audit by independent third parties. Findings remediated and tracked.
Governance + board oversight
MLRO, Compliance Officer, and Risk Officer report to the Board. Regulatory matters escalate immediately.
ROADMAP
Phase 2: Crypto bridging (license-pending).
When LFSA opens digital asset bridging under its DAS framework, we will apply for Phase 2 expansion. Until then, we operate strictly within fiat under our PSO license — no virtual asset services. Phase 1 capabilities are live and audited.
FAQ
About our licensing & compliance
The questions we get most often from merchants and regulators.
Kaadxpay operates under a Payment System Operator (PSO) license issued by the Labuan FSA (Labuan Financial Services Authority, Malaysia), approved on 16 January 2026. The license covers cross-border payment orchestration, multi-currency acquiring, and local payouts; it does not cover crypto-to-fiat conversion, which requires a separate license upgrade.
Labuan FSA carries a FATF Tier-1 (Compliant) rating, the same tier as MAS (Singapore) and HKMA (Hong Kong). Advantages: cross-border-licensed entities pay 3% corporate income tax (or USD 5,000 flat / year, electable annually). Disadvantage: lower brand recognition than MAS. We chose Labuan because it offers the best compliance-depth + tax + corridor-recognition combination available within ASEAN.
Customer funds are held in segregated client trust accounts at Labuan FSA-approved custodian banks, fully separate from Kaadxpay operating capital. Reconciliation runs twice daily (account balance vs ledger + bank statement). Quarterly audits by Labuan FSA, annual statutory audit. Any customer can request a Proof of Funds attestation post-KYC.
We apply FATF-standard Customer Due Diligence (CDD) on every merchant: legal entity structure, UBO (Ultimate Beneficial Owner), source-of-funds documentation, sanctions screening (OFAC + UN + EU + local). High-risk industries / jurisdictions trigger Enhanced Due Diligence (EDD). All transactions are monitored in real time; suspicious activity reports (STRs) are filed within 24h of detection.
Labuan FSA requires every PSO to file a Wind-Down Plan at license issuance. The plan stipulates: client funds returned in full within 7 business days; operations continue ≥30 days until all in-flight settlements clear; trust accounts handed to an independent custodian. Our Wind-Down Plan is FSA-approved; an executive summary is available on request via the contact page.
The current PSO license does not cover crypto-to-fiat services. We have filed a license upgrade with Labuan FSA targeting H2 2026 approval. Until then, the Kaadxpay platform processes pure fiat-to-fiat flows only — no crypto endpoints are exposed.
Want to verify our license?
Contact us for license documentation, regulator references, or compliance program details.