EMI regulations in Europe

The e-money market in Europe has seen significant growth in recent years, which in turn has attracted the attention of regulators and legislators. The regulation of e-money institutions in the EU is governed by the Electronic Money Directive (2009/110/EC) as well as the second payment directive PSD2 (Directive (EU) 2015/2366), which aim to ensure payment security and consumer protection. In this article, lawyers from Regulated United Europe would like to address key regulatory aspects for e-money institutions in Europe, including licensing requirements, share capital and the application process.

Licensing requirements

Companies need to obtain an EMI (Electronic Money Institution) licence in order to start operating in the electronic money sector. Obtaining such a licence requires the company to fulfil a number of conditions, including:

  • Providing a business plan: A detailed business plan describing the proposed activities, risk management systems, administrative structure and projected financial flows.
  • Management team: Evidence that the management team has the necessary experience and qualifications.
  • Anti-money laundering (AML) measures: Implement effective procedures and systems to prevent money laundering and terrorist financing.
  • The minimum authorised capital for e-money institutions in Europe is 350,000 euros. This capital must be paid in full at the time of application for a licence.

Application review process

After submission of the application and all necessary documents, the regulator starts the review process. This process may take from 3 to 12 months, depending on the country, completeness and quality of the submitted documentation, as well as on the specifics of the declared activity. During this time, the regulator may request additional information or clarifications. The regulation of e-money institutions in Europe is aimed at creating a safe and transparent environment for electronic payments, as well as protecting the interests of consumers. At the same time, regulators endeavour to support innovation and competition in the market. Companies wishing to enter this fast-growing sector must prepare carefully for the licensing process, ensuring they meet all requirements and regulatory standards. Successfully obtaining an EMI licence opens up a wide range of opportunities for companies to develop and expand in the European e-money market.

EMI regulations in Lithuania

LithuaniaIn recent years, Lithuania has actively established itself as one of the leading European hubs for the fintech industry, including e-money institutions. The country offers a favourable regulatory environment aimed at stimulating innovation and attracting international companies.

Regulatory Environment

The Lithuanian Bank (Lietuvos bankas) is the main regulator responsible for issuing licences to e-money institutions. The regulation is based on the EU E-money Directive (2009/110/EC) and provides for strict requirements for operations and risk management.

Licensing Requirements

In order to obtain a licence to establish electronic money in Lithuania, companies must meet the following basic requirements:

  • Authorised capital: The minimum authorised capital for the establishment of electronic money is EUR 350,000.
  • Business Plan: A detailed business plan describing the proposed activity, including a risk assessment and risk management strategy, is required.
  • Management structure: The company should demonstrate a clear organisational structure with defined lines of responsibility and an adequate risk management policy.
  • AML Procedures: Implementing effective AML and terrorist financing procedures.

Application Submission and Review Process

The application process includes preparation and submission of the required package of documents to the Lithuanian Bank. After the application is submitted, the regulator carries out a thorough analysis of the submitted information and documents.

  • Application processing time: The standard application processing time is 3 to 6 months, depending on the completeness and complexity of the documentation submitted.
  • Inspections and audits: During the review process, the Lithuanian Bank may request additional documents or arrange meetings with company representatives to clarify information.

Conclusion

Lithuania offers attractive conditions for e-money institutions due to its strategic geographical location, developed fintech infrastructure and supportive regulatory environment. Compliance with the above-mentioned requirements and careful attention to the application process significantly increases the company’s chances of successfully obtaining a licence and developing its e-money activities in the European market.

EMI regulations in the UK

EMI regulations in the UKThe UK has long established itself as one of the world’s leading centres of financial innovation, particularly in the area of fintech and e-money institutions. E-money institutions in the UK are regulated by the Financial Conduct Authority (FCA – Financial Conduct Authority), which sets strict standards to ensure transparency, safety and soundness of financial services. In this article we will look at the key regulatory aspects for e-money institutions in the UK, using business language and a business style of communication.

Licensing Requirements

To start operating as an e-money institution in the UK, you must obtain the appropriate licence from the FCA. This requires the company to fulfil the following conditions:

  • Share capital: The minimum amount of share capital depends on the type of licence requested. A minimum of £350,000 is required for a full EMI (Electronic Money Institution) licence.
  • Business Plan and Financial Projections: Detailed business plan, including business model description, financial projections, risk analysis and mitigation strategies.
  • Policies and Procedures: Develop and provide policies and procedures, including anti-money laundering (AML) measures and customer data protection compliance.
  • Management team: Evidence of the competence and reliability of the management team and key individuals responsible for the institution’s operations.

Application Submission and Review Process

  • Applying: An application for a licence is made through the FCA’s online portal, providing all the required documents and information.
  • Processing time: The processing time for an EMI licence application can vary, but is usually between 3 and 6 months, depending on the completeness and complexity of the documentation submitted.
  • Assessment and verification: During the review process, the FCA carries out a detailed assessment of the information provided and may request additional data or clarification.

Conclusion

Obtaining an e-money institution licence in the UK is a complex and demanding process that requires careful preparation and attention to detail. Compliance with FCA regulatory requirements and standards ensures that e-money institutions can offer their services at a high level of safety and security, which in turn helps to build consumer confidence and maintain the stability of the UK financial system.

EMI regulations in Netherlands

EMI regulations in NetherlandsThe Netherlands, like many other countries in the European Union, aims to ensure the safe and secure use of e-money, while providing a favourable environment for innovation and development of the fintech sector. E-money institutions in the Netherlands are regulated by the Netherlands Bank (De Nederlandsche Bank, DNB) and the Netherlands Authority for Financial Markets (Autoriteit Financiële Markten, AFM), which together ensure compliance with national and European regulations.

Licensing requirements

In order to start operating as an e-money institution in the Netherlands, it is necessary to obtain the appropriate licence from the DNB. The licensing process involves demonstrating the ability to meet the following basic requirements:

  • Authorised capital: The minimum amount of authorised capital for the establishment of electronic money in the Netherlands is EUR 350,000.
  • Business Plan: Provide a detailed business plan including a description of the services offered, market analysis, marketing strategy, financial projections and risk assessment.
  • Management structure and personnel: Qualified management and staff with relevant experience and reputation.
  • Anti-Money Laundering (AML) and Terrorist Financing Measures: Developing and implementing effective AML procedures and controls.

Application and review process

  • Application: The licence application is submitted through the DNB online platform, accompanied by all required documents and information.
  • Processing time: The standard processing time for an application for an e-money institution licence is between 3 and 6 months, depending on the complexity of the application and the completeness of the information provided.
  • Assessment and verification: During the review process, DNB and AFM conduct a detailed analysis of the information provided, including the company’s financial stability, business model, risk management systems and AML procedures. Regulators may request additional information or arrange meetings with applicants to clarify details.

Conclusion

Obtaining an e-money institution licence in the Netherlands is a complex process that requires careful preparation and strict compliance with regulatory requirements. The Netherlands offers a favourable environment for fintech companies, emphasising the importance of innovation in the financial sector while ensuring a high level of consumer protection and stability of the financial system. Companies seeking to operate in the e-money sector in the Netherlands should pay particular attention to preparing for the licensing process in order to successfully enter this promising market.

EMI regulations in Cyprus

EMI regulations in CyprusCyprus, as a member of the European Union, strictly follows European directives and regulations, including in the field of electronic money. E-money institutions in Cyprus are regulated by the Central Bank of Cyprus (CBC) in accordance with the EU E-money Directive (2009/110/EC).

Licensing requirements

To start operating as an e-money institution in Cyprus, a licence must be obtained from the Central Bank of Cyprus. Key requirements include:

  • Authorised capital: The minimum amount of authorised capital for the establishment of electronic money is EUR 350,000.
  • Business Plan: Provide a detailed business plan, including a description of the services offered, market analyses, risk management strategies and financial flow projections.
  • Management structure: Evidence of an adequate management structure and leadership experience capable of ensuring the healthy and efficient operation of the institution.
  • AML/CFT Policies: Develop and implement policies and procedures to combat money laundering and terrorist financing.

Application and review process

  • Application: The application for a licence, including all required documents and information, is submitted to the Central Bank of Cyprus.
  • Processing time: The standard processing time for an application is 3 to 6 months. However, this timeframe may vary depending on the completeness and complexity of the documentation submitted.
  • Additional Requests: During the review process, the Central Bank may request additional documents or clarifications.

Conclusion

Obtaining an e-money institution licence in Cyprus requires careful preparation and strict compliance with regulatory requirements. Cyprus offers a favourable legal and tax environment for fintech companies, as well as access to the European Union market, making it an attractive choice for many international e-money players. Companies seeking to capitalise on these opportunities should pay particular attention to preparing for the licensing process in order to successfully enter the financial sector in Cyprus.

EMI regulations in Poland

EMI regulations in PolandIn recent years, Poland has been actively developing its fintech sector, aiming to become one of the leaders in Central and Eastern Europe in the field of innovative financial technologies. E-money institutions in Poland are regulated in accordance with the European E-money Directive (2009/110/EC) and local legislation governing financial services. The key role in licensing and supervision of e-money institutions is played by the Commission for Financial Supervision (KNF Komisja Nadzoru Finansowego).

Licensing requirements

In order to carry out the activities of an e-money institution in Poland, it is necessary to obtain a licence by fulfilling the following requirements:

  • Business Plan: Provide a detailed business plan including a description of the business, risk assessment, marketing strategy and financial projections.
  • Management structure: Evidence of an effective management structure and qualified management with a clean business reputation.
  • AML Procedures: Developing and implementing anti-money laundering (AML) and terrorist financing policies and procedures.

Application and review process

  • Application: An application for a licence is submitted to the Financial Supervisory Commission together with all the required documents.
  • Processing time: The standard processing time for an application is between 3 and 6 months. However, this period may vary depending on the complexity and completeness of the documentation submitted.
  • Additional Requests: During the review process, KNF may request additional information or arrange meetings with applicants to discuss the details of the application.

Conclusion

Poland offers a favourable environment for the development of e-money institutions, supported by clear regulatory requirements and active support for innovation in the fintech sector. Obtaining a licence requires thorough preparation and strict compliance with all regulatory standards. Successfully overcoming this process gives companies access to the dynamic financial services market in Poland and allows them to contribute to the progress of the country’s digital economy.

EMI regulations in Sweden

EMI regulations in SwedenIn Sweden, which is one of the leading countries in the world in terms of financial technology development, regulation of e-money institutions is carried out by the Swedish Financial Supervisory Authority (Finansinspektionen). The introduced regulations are aimed at ensuring the stability of the financial system, protecting consumer rights and preventing financial crime.

Licensing requirements

In order to obtain an e-money licence in Sweden, a company must meet the following basic requirements:

  • Business Plan: A detailed business plan should be submitted describing the proposed activity, including expected e-money transactions, risk assessment and risk management mechanisms.
  • Management structure: The company should have a clear organisational structure with defined lines of responsibility, adequate internal controls and risk management procedures.
  • AML/CFT policies: Policies and procedures should be developed and implemented to prevent the company from being used for money laundering and terrorist financing purposes.

Application and review process

  • Application: An application for a licence is submitted to the Swedish Financial Supervisory Authority together with all necessary documents and information.
  • Processing time: The standard processing time for an application is between 3 and 6 months. However, this period may vary depending on the complexity and completeness of the documentation submitted.
  • Additional Requests: During the application process, the Financial Supervisory Authority may request additional documents or clarifications to fully understand the company’s business model and operations.

Conclusion

Sweden offers a favourable environment for the development and growth of e-money institutions due to its innovative economy and progressive regulation. Compliance with licensing requirements and successful completion of the application process opens up opportunities for companies to operate in the e-money sector in the Swedish market. However, it is important to prepare carefully for the process, with a focus on developing a business plan, management structure and anti-money laundering and anti-terrorist financing policies to meet the high standards set by the Swedish Financial Supervisory Authority.

EMI regulations in Germany

EMI regulations in Germany In Germany, one of the leading economies in Europe, the regulation of e-money institutions strictly complies with European standards and directives, ensuring a high level of consumer protection and stability of the financial system. E-money institutions are regulated by the Federal Financial Services Supervisory Authority (BaFin Bundesanstalt für Finanzdienstleistungsaufsicht), which requires strict regulatory compliance and has high licensing requirements.

Licensing requirements

In order to operate an e-money institution in Germany, a licence must be obtained from BaFin. The main requirements for obtaining a licence include:

  • Authorised capital: The minimum authorised capital for the establishment of electronic money must be at least EUR 350,000.
  • Business Plan: A detailed business plan should be submitted, including a description of the proposed activity, market analysis, financial projections and risk assessment.
  • Management structure: The company should demonstrate a robust management structure with clear lines of responsibility and adequate risk management policies.
  • AML Procedures: Developing and implementing effective anti-money laundering (AML) and terrorist financing procedures.

Application and review process

  • Application: The application for a licence shall be submitted to BaFin together with all necessary documents and proof of compliance with the above requirements.
  • Processing time: The processing time for an application is usually between 6 and 12 months, depending on the completeness and complexity of the documentation submitted.
  • Additional enquiries: During the review process, BaFin may request additional information or arrange meetings with company representatives to discuss the details of the application.

Conclusion

The regulation for the establishment of e-money in Germany is a complex and multi-stage procedural endeavour that requires careful planning and strict compliance with regulatory requirements. Obtaining a licence from the BaFin is a key step for conducting e-money business, opening access to one of Europe’s largest and most developed financial markets. Successful applicants must demonstrate not only a financially sound and transparent business model, but also a high level of responsibility in risk management and regulatory compliance.

EMI regulations in Spain

EMI regulations in Spain In Spain, the regulation of e-money institutions is determined by both national and European legislation. Regulation is aimed at ensuring the stability of the financial system, protecting consumer rights and preventing financial crimes such as money laundering and terrorist financing.

Process for obtaining a licence

To start operating as an e-money institution in Spain, it is necessary to obtain the relevant licence from the National Securities Market Commission (CNMV) or the Bank of Spain, depending on the specific nature of the activity. The application process includes the submission of a detailed business plan, a description of risk management systems and control procedures, and confirmation of compliance with regulatory capital and liquidity requirements.

Requirements for the applicant

The applicant institution must demonstrate its financial strength, adequate organisational structure, professional and reliable management, and ability to comply with regulatory requirements for e-money activities. Key consideration is also given to data protection systems and measures to combat money laundering and terrorist financing.

Amount of the required authorised capital

The minimum amount of authorised capital for e-money institutions in Spain depends on the scope of the planned activity, but according to European regulations it must not be less than 350,000 euros. This capital is necessary to ensure the financial stability of the institution and the ability to cover start-up costs and potential losses.

Application processing time

The time required to process a licence application can vary depending on the complexity of the application and the current workload of the regulatory authorities. On average, the process can take from 3 to 6 months from the date of submission of all required documents. It is important to note that timely and complete submission of all required information and documents significantly accelerates the review process.

Conclusion

Entering the e-money market in Spain requires careful planning and preparation, including developing a solid business plan and ensuring compliance with stringent regulatory requirements. Successfully obtaining a licence gives e-money institutions access to the country’s dynamic financial sector, providing opportunities for growth and development. The key success factor is not only obtaining a licence, but also maintaining high operational standards, including the quality of customer service and the safety and soundness of financial transactions.

EMI regulations in Italy

EMI regulations in ItalyE-money institutions in Italy are regulated in accordance with the European e-money Directive (2009/110/EC) and national legislation, in particular the regulations issued by the Bank of Italy. These regulations aim to ensure market stability and transparency, consumer protection and the prevention of financial crime. In order to operate in the e-money sector in Italy, companies need to obtain a licence, comply with a number of requirements and maintain a certain level of share capital.

Process for obtaining a licence

In order to obtain a licence, e-money institutions must submit an application to the Bank of Italy, including a detailed business plan, a description of the risk management system, information on the managers and owners, and evidence of compliance with regulatory requirements for share capital. The Bank of Italy analyses the application to ensure that it meets the established criteria, including the financial strength of the applicant, the reputation and experience of the management team, and the adequacy of systems and controls to prevent financial crime.

Requirements for the applicant

Key requirements for applicants include:

  • Having a well-structured business plan that demonstrates the viability of the venture.
  • Compliance with regulatory requirements for risk management and internal control.
  • Proof of professionalism and reliability of managers and key employees.
  • Adequate measures to combat money laundering and terrorist financing.

Amount of the required authorised capital

The minimum authorised capital for e-money institutions in Italy is €350,000. This capital is required to cover initial operating costs and as a financial cushion to cover potential losses. The amount of capital may be adjusted upwards depending on the scope of activities and risk assessment.

Application processing time

The processing time of an application for an e-money institution licence in Italy may vary, but usually ranges from 3 to 6 months after the submission of a complete set of documents. The processing time depends on the quality of the submitted documentation and the current workload of the Bank of Italy. Complete and accurate submission of all required information and documents contributes to a faster review process.

Conclusion

Obtaining a licence to establish e-money in Italy requires careful preparation and strict compliance with regulatory requirements. This includes developing a detailed business plan, securing sufficient authorised capital and demonstrating an effective risk management system. Successfully completing the licensing process allows companies to enter Italy’s dynamic e-money market, providing significant opportunities for growth and development in the financial sector.

EMI regulations in France

EMI regulations in FranceIn France, the regulation of e-money institutions is strictly defined and monitored by French financial regulators, in particular the Autorité de Contrôle Prudentiel et de Résolution (ACPR), which operates under the auspices of the Bank of France. These regulations include the need to obtain a licence, meet certain share capital requirements and comply with procedures designed to protect consumers and ensure the stability of the financial system.

Process for obtaining a licence

To start operating as an e-money institution in France, a licence must be obtained from the ACPR. The application process involves the preparation and submission of a number of documents, including a detailed business plan, a description of the risk management system, information on the executive and management team, and proof of sufficient authorised capital. Applicants must also demonstrate their ability to comply with legal and regulatory requirements, including anti-money laundering and anti-terrorist financing measures.

Requirements for the applicant

Establishments seeking a licence must meet the following requirements:

  • Having a clear and realistic business plan covering financial projections and development strategy.
  • Proof of the reliability and professionalism of the management.
  • Establishment of effective risk management systems and internal controls.
  • Adequacy of measures to prevent money laundering and terrorist financing.

Amount of the required authorised capital

The minimum authorised capital for e-money institutions in France depends on the volume of their operations, but should normally be at least €350,000. This capital is necessary to ensure the financial stability of the institution during the start-up period and as a protection against potential financial risks.

Application processing time

The processing time of an application for a licence by an e-money institution in France can vary, but usually takes between three and six months. The processing time depends on the completeness and quality of the documentation provided, as well as the current workload of ACPR. Careful preparation and submission of all required documents in full helps to speed up the process.

Conclusion

Obtaining a licence to operate as an e-money institution in France requires considerable effort and strict compliance with regulatory requirements. This includes preparing a detailed business plan, securing sufficient share capital and demonstrating the ability to effectively manage risk and comply with regulatory standards. Successfully obtaining a licence opens up access to the French e-money market, offering institutions opportunities for growth and development in a highly regulated but promising environment.

EMI regulations in Ireland

EMI regulations in IrelandIreland, due to its strategic location and favourable tax regime, attracts many e-money institutions seeking to operate within the European Union. Regulation of e-money institutions in Ireland is subject to European directives and local legislation, with the Central Bank of Ireland, CBI  – playing a key role in regulation and supervision.

Process for obtaining a licence

An e-money institution in Ireland requires a licence from the Central Bank of Ireland to operate. The application process involves the preparation and submission of a comprehensive package of documents, including a detailed business plan, evidence of financial strength, a description of risk management systems, information on principals and beneficial owners, and compliance plans, including anti-money laundering (AML) and counter-terrorist financing (CFT) measures.

Requirements for the applicant

Institutions applying for a licence must meet a number of criteria set out by the Central Bank of Ireland, including:

  • Demonstration of a clear organisational structure and adequate internal controls.
  • Existence of sufficient and adequate level of authorised capital.
  • Confirmation of professionalism and reliability of the management staff.
  • Ability to manage risk effectively, including credit, market, operational, liquidity and capital risks.

Amount of the required authorised capital

The minimum authorised capital for e-money institutions in Ireland is €350,000. This capital is required to ensure that the institution is financially sound and able to meet its current and future liabilities.

Application processing time

The time required to process a licence application may vary, but on average takes between 3 and 6 months after submission of a complete and correct set of documents. The timeframe may be extended depending on the complexity of the application and the current workload of the Central Bank.

Conclusion

Obtaining an e-money institution licence in Ireland requires careful preparation and strict compliance with regulatory requirements. Successful applicants must demonstrate financial strength, adequate risk management and a commitment to high operational standards. Obtaining a licence opens up access to the European Union market, providing significant opportunities for growth and development in the e-money industry.

EMI regulations in Malta

EMI regulations in Malta Malta is actively developing its financial sector, aiming to become a leading centre for financial technology and innovation in Europe. E-money institutions in Malta are regulated in accordance with European directives and local legislation, with the Malta Financial Services Authority, MFSA  playing a key role in licensing and supervision. Malta’s regulatory environment is designed to ensure the stability and soundness of the financial system and to protect the interests of consumers.

Process for obtaining a licence

In order to start operating as an e-money institution in Malta, it is necessary to obtain a licence from the MFSA. The application process involves the preparation of an extensive application package, which must include a detailed business plan, a description of internal procedures and policies, management information, and evidence of compliance with authorised capital and financial stability requirements. Applicants must also demonstrate their risk management systems and compliance with money laundering and terrorist financing prevention requirements.

Requirements for the applicant

Key requirements for applicants include:

  • Having a clear and realistic business plan describing the proposed operations, market strategies and financial projections.
  • A transparent organisational structure with a clear division of responsibilities and authority.
  • Sufficient and adequate authorised capital to support start-up activities and risk management.
  • Systems and procedures for effective risk management, including credit, operational, market, liquidity and capital risks.
  • Measures to combat money laundering and terrorist financing.

Amount of the required authorised capital

The minimum amount of share capital for e-money institutions in Malta depends on the type of licence and the scope of the proposed activity. It usually ranges from €350,000 for entry level activities. This capital should be sufficient to cover all risks and liabilities associated with the activities of the institution.

Application processing time

The processing time for a licence application is typically three to six months, depending on the complexity of the application and the current workload of the MFSA. It is important to note that timely and complete submission of all required documents and information can significantly expedite the review process.

Conclusion

E-money institutions wishing to operate in Malta should carefully prepare for the licensing process by strictly complying with regulatory requirements and demonstrating their ability to effectively manage risk and ensure financial stability. Successfully obtaining a licence opens up access to a dynamic e-money market in a jurisdiction with an attractive regulatory and tax regime, offering significant opportunities for growth and expansion.

EMI regulations in Luxembourg

EMI regulations in Luxembourg Luxembourg, being one of the leading financial centres in Europe, offers a favourable environment for the development of e-money institutions. The regulation of these institutions in Luxembourg is carried out by the Commission de Surveillance du Secteur Financier, CSSF, strictly following European directives and local legislation. This regulation is aimed at ensuring the stability of the financial market, protecting consumers and preventing financial crime.

Process for obtaining a licence

To start operations, e-money institutions in Luxembourg need to obtain a licence from the CSSF. The application process requires detailed preparation and includes the submission of a comprehensive set of documents: a detailed business plan, a description of the risk management system, information on the principals and beneficial owners, and proof of compliance with regulatory capital and financial strength requirements. Applicants must also demonstrate their ability to comply with legal and regulatory requirements, including anti-money laundering (AML) and counter-terrorist financing (CFT) measures.

Requirements for the applicant

Applicants are subject to the following requirements:

  • Having a clear and sound business plan that includes financial projections and growth strategies.
  • Transparent organisational structure and adequate internal controls.
  • Sufficient authorised capital to support start-up activities and the ability to cover risks.
  • Policies and procedures to ensure compliance with anti-money laundering and counter-terrorist financing legislation.

Amount of the required authorised capital

The minimum authorised capital for e-money institutions in Luxembourg is €350,000. This capital is required to ensure that the institution is financially sound and able to meet liquidity and operational requirements.

Application processing time

The processing time of an application for a licence by an e-money institution in Luxembourg varies, but on average ranges from 3 to 12 months, depending on the complexity of the application and the current workload of the CSSF. It is important to note that the completeness and quality of the documentation provided can significantly affect the speed of the application.

Conclusion

To successfully obtain a licence and operate, e-money institutions in Luxembourg need to prepare thoroughly and ensure that they meet all regulatory requirements. Luxembourg offers e-money institutions an attractive regulatory environment and access to the European market, making it a desirable location for many fintech companies. It is important to approach the licensing process with due care and professionalism to ensure successful business development in this jurisdiction.

PI regulations in Europe

PSP/ PISP regulations in Europe

The regulation of payment service providers in Europe is a key component to ensure the safety, security and efficiency of payment systems in the region. This regulation is carried out at the European Union (EU) level and includes a number of directives and regulations aimed at creating a single market for payment services. The Electronic Money Directive (EMD) and the Payment Services Directive (PSD2) serve as the basis for regulation, setting out requirements for licensing, risk management, consumer protection and anti-money laundering.

Process for obtaining a licence

In order to commence operations, a payment service provider must obtain a licence from the national regulator of the EU Member State in which it plans to operate. The application process involves the preparation and submission of an extensive set of documents demonstrating the company’s compliance with the regulator’s requirements. The key elements include a business plan, risk management policies, internal control systems, information on managers and founders, and evidence of financial stability.

Requirements for the applicant

Payment service providers must demonstrate:

  • A clear organisational structure and adequate risk management procedures.
  • Availability of qualified management and compliance with clean reputation requirements.
  • Ability to protect customer funds and provide a high level of security for payment transactions.
  • Compliance with anti-money laundering and counter-terrorist financing requirements.

Amount of the required authorised capital

The minimum amount of authorised capital for payment service providers depends on the type of services provided and can range from EUR 20,000 to EUR 125,000 for start-up positions. For large operators providing a wide range of payment services, capital requirements may be significantly higher.

Application processing time

The processing time for licence applications varies from country to country and from regulator to regulator, but on average ranges from 3 to 12 months. Effective preparation and completeness of submitted documents can shorten the processing time.

Conclusion

Obtaining a licence for a payment service provider in Europe requires careful preparation and strict compliance with regulatory requirements. This includes not only preparing and submitting all necessary documents, but also developing effective risk management and internal control systems. Successful completion of the licensing process opens access to the single European market for payment services, offering significant opportunities for growth and development in the financial technology sector.

AISP regulations in Europe

Account Information Service Providers (AISPs) play an important role in Europe’s financial ecosystem by providing users with an overview of their financial information through various bank and financial accounts in a single interface. AISPs in Europe are regulated under the Second Payment Services Directive (PSD2), which aims to increase competition and innovation in the payments sector and to enhance consumer protection.

Process for obtaining a licence

In order to provide account information services, companies need to obtain a licence from the national regulator in their country of incorporation. The process of obtaining a licence involves submitting an application detailing the business model, management information, anti-money laundering and counter-terrorist financing measures, and security and data protection systems. Internal control and risk management policies must also be demonstrated.

Requirements for the applicant

  • Clear business model: AISPs should clearly describe their business model, including the types of services to be provided and how they will be delivered.
  • Risk management: The company should have established procedures for managing risks, including data security and privacy risks.
  • GDPR Compliance: AISPs must comply with the EU-wide Data Protection Regulation (GDPR), ensuring a high level of protection for users’ personal data.
  • Anti-money laundering measures: Procedures should be put in place to prevent the use of the company’s services for money laundering or terrorist financing.

Amount of the required authorised capital

For AISPs, the European Commission has not set strict minimum share capital requirements, unlike payment or e-money institutions. However, national regulators may set their own requirements for the financial stability of companies depending on the scope and specificity of their activities.

Application processing time

The processing time of an application for an AISPs licence can vary from country to country, but on average takes from 3 to 6 months. This period may be extended depending on the completeness and quality of the submitted documents, as well as on the specific requirements of the national regulator.

Conclusion

Obtaining a licence to provide account information services in Europe requires careful preparation and strict compliance with regulatory requirements, especially in terms of data protection and risk management. However, successfully obtaining a licence gives AISPs access to the wider European Union market, providing opportunities to develop and expand their financial technology business.

PI regulations in Lithuania

PI regulations in LithuaniaLithuania has been actively developing its reputation in recent years as one of the leading centres of the fintech industry in Europe, offering a favourable regulatory and business environment for payment service providers and payment institutions. Regulation in this area is carried out by the Bank of Lithuania, which acts as the main regulator and supervisor.

Process for obtaining a licence

In order to start operations, a payment service provider must obtain a relevant licence from the Bank of Lithuania. The process involves submitting an application with a set of documents, which usually includes a business plan, a description of the risk management system, information on managers, founders and beneficial owners, and evidence of financial stability. Applicants must also demonstrate their ability to comply with legal and regulatory requirements, including anti-money laundering and anti-terrorist financing measures.

Requirements for the applicant

  • Financial strength: Payment service providers must demonstrate that they have sufficient share capital and financial strength to carry out their intended activities.
  • Leadership and management: There should be evidence of the reliability and professionalism of the organisation’s management and key staff.
  • Compliance with legislation: The Company shall ensure compliance with Lithuanian and EU legal requirements, including those related to data protection, anti-money laundering and countering the financing of terrorism.

Amount of the required authorised capital

The minimum amount of share capital for payment service providers in Lithuania depends on the type of licence requested. For payment institutions, it may be from EUR 20,000 to EUR 125,000, depending on the scope and specifics of the services provided.

Application processing time

The processing time of an application for a payment service provider licence in Lithuania is from 3 to 6 months from the date of submission of a complete set of documents. The processing time may vary depending on the complexity of the application and the current workload of the Bank of Lithuania.

Conclusion

Lithuania provides payment service providers with favourable conditions for development and integration into the European financial market. Strict but fair regulation by the Bank of Lithuania ensures a high level of confidence in the activities of payment organisations, contributing to their sustainable growth and development. Obtaining a licence requires thorough preparation and strict compliance with regulatory requirements, but opens up a wide range of opportunities in the EU market.

PI regulations in the UK

PI regulations in UKThe UK has long been regarded as one of the world’s leading centres of financial innovation, providing a favourable environment for the development of payment services and payment organisations. Regulation in this area is carried out by the Financial Conduct Authority, FCA, which is responsible for maintaining the integrity and stability of the UK financial markets.

Process for obtaining a licence

In order to operate as a payment service provider in the UK, a licence must be obtained from the FCA. The application process involves the preparation and submission of an extensive package of documents, which should include a business plan, information on directors and beneficial owners, a description of the risk management system, and policies and procedures to comply with anti-money laundering and counter-terrorist financing legislation.

Requirements for the applicant

  • Financial strength: The company must demonstrate that it has sufficient authorised capital and financial strength.
  • Management: Qualified management with a clean reputation and relevant financial experience is required.
  • Regulatory Compliance: the Company must ensure compliance with all relevant legal and regulatory requirements, including GDPR and FCA rules.

Amount of the required authorised capital

The amount of authorised capital required depends on the type of payment services provided. The FCA has different minimum share capital requirements for payment institutions and e-money issuers, which can start from £20,000 for some categories and reach much higher amounts for organisations engaged in a wider range of payment services.

Application processing time

The processing time for a licence application can vary and depends on many factors, including the completeness and quality of the documentation submitted and the FCA’s current workload. On average, the application process takes between 3 and 6 months, but in some cases additional time may be required.

Conclusion

The UK offers payment service providers a stable and transparent regulatory environment that encourages innovation and consumer protection. Obtaining a licence from the FCA requires rigorous preparation and strict compliance. Successful candidates have the opportunity to work in one of the most developed financial markets in the world, enjoying the trust and support of the regulator.

PI regulations in the Netherlands

PI regulations in NetherlandsThe Netherlands has established itself as one of Europe’s leaders in financial technology and innovation, offering a favourable environment for the development of payment service providers and payment organisations. These services in the Netherlands are regulated by the DNB, the Dutch Central Bank and the Authority for the Financial Markets of the Netherlands (AFM), which guarantee high standards of security, transparency and reliability.

Process for obtaining a licence

Obtaining a licence for a payment service provider in the Netherlands begins with an application to the DNB or AFM, depending on the type of services provided. The application process includes the preparation and submission of a detailed application package, which should include a business plan, a description of the internal organisational structure, information on the management, risk management policies, and anti-money laundering and anti-terrorist financing strategies.

Requirements for the applicant

  • Financial strength: The company must demonstrate that it has sufficient authorised capital and the ability to maintain financial stability.
  • Management and organisational structure: There should be a qualified management with a clean reputation and an adequate organisational structure.
  • Regulatory Compliance: The Company is required to comply with all relevant Dutch and European Union legislative and regulatory requirements, including anti-money laundering and counter-terrorist financing regulations.

Amount of the required authorised capital

The minimum authorised capital for payment service providers in the Netherlands varies depending on the type of activity. For example, for payment institutions it may start from EUR 125,000. The exact capital requirements are determined based on the scope and nature of the payment services provided.

Application processing time

The processing time for a licence application is usually between 3 and 6 months, but can vary depending on the complexity of the application and the current workload of the regulator. It is important to ensure that the documentation provided is complete and accurate to expedite the review process.

Conclusion

The Netherlands provides payment service providers with a stable regulatory environment that fosters innovation and consumer protection. Obtaining a licence requires thorough preparation and strict compliance. Successful candidates have the opportunity to work in one of Europe’s most innovative and developed financial markets.

PI regulations in Cyprus

PI regulations in CyprusCyprus, as a member of the European Union, offers a favourable environment for the development of financial technology and payment services, attracting companies from all over the world. Payment service providers and payment organisations in Cyprus are regulated by the Central Bank of Cyprus and the Cyprus Securities and Exchange Commission, CySEC, depending on the specific services provided. These regulators ensure that companies comply with local and European legislation, including the Payment Services Directive (PSD2), which aims to increase transparency and security of payments in the EU.

Process for obtaining a licence

In order to obtain a licence, a payment service provider must submit an application to the Central Bank of Cyprus or CySEC. The process involves the preparation and submission of a detailed set of documents, which should include a business plan, information on the principals and beneficial owners, a description of the risk management system, and evidence of financial stability and anti-money laundering measures.

Requirements for the applicant

  • Financial strength: It is necessary to demonstrate sufficient authorised capital and financial strength to carry out the proposed activities.
  • Management: The company should have qualified management with a proven track record and experience in the financial sector.
  • Legal Compliance: It is mandatory to comply with all regulatory requirements, including Cyprus laws and EU directives, particularly in the areas of data protection and anti-money laundering.

Amount of the required authorised capital

The minimum amount of share capital for payment service providers in Cyprus depends on the type of licence and may start from €20,000 for small payment institutions and reach up to €125,000 for full payment institutions. The exact requirements are determined depending on the volume and nature of payment transactions to be carried out.

Application processing time

The processing time for a licence application is usually between 3 and 6 months, but can vary depending on the complexity of the application and the regulator’s workload. It is important to ensure that the documentation provided is complete and accurate to expedite the review process.

Conclusion

Cyprus offers an attractive environment for payment service providers, combining strict but fair regulatory requirements with access to the single European market. Obtaining a licence requires thorough preparation and strict compliance. Successful candidates are given the opportunity to work in a stable and innovative financial environment that fosters growth and development in the payment services industry.

PI regulations in Poland

PI regulations in PolandPoland is actively developing its financial sector and fintech industry, providing favourable conditions for payment service providers and payment organisations. Regulation of this area in Poland is carried out by the Financial Supervision Commission (Komisja Nadzoru Finansowego, KNF), which is responsible for the supervision and control of financial markets, including payment services. The regulation aims to ensure market stability and transparency, as well as to protect the interests of consumers.

Process for obtaining a licence

To start operating as a payment service provider in Poland, it is necessary to obtain a licence from the KNF. The application process involves the preparation and submission of a comprehensive package of documents, which must include a business plan, information on managers and owners, a description of the risk management system, as well as evidence of compliance with authorised capital and financial stability requirements. Applicants must also demonstrate their ability to comply with regulatory requirements, including anti-money laundering and counter-terrorist financing measures.

Requirements for the applicant

  • Financial strength: The company must ensure that it has sufficient authorised capital to carry out its activities.
  • Governance and management: Qualified management with a clean business reputation and an adequate organisational structure are required.
  • Compliance: The Company is required to comply with all relevant legal and regulatory requirements, including those relating to data protection and anti-money laundering.

Amount of the required authorised capital

The minimum authorised capital for payment service providers in Poland depends on the type of services provided. For payment institutions, the minimum authorised capital ranges from EUR 20,000 to EUR 125,000, depending on the scope and specifics of the services provided. Detailed requirements can be found on the official website of the KNF.

Application processing time

The processing time of a payment service provider licence application in Poland is on average between 3 and 6 months, but may vary depending on the complexity of the application and the workload of the KNF. It is important to ensure that the documentation provided is complete and accurate in order to speed up the review process.

Conclusion

Poland provides an attractive regulatory and business environment for payment service providers, fostering innovation and competition in the financial market. Obtaining a licence requires thorough preparation and strict compliance with the established requirements. Successful candidates have the opportunity to work in one of the most dynamic financial markets in Europe, contributing to further growth and innovation in payment services.

PI regulations in Sweden

PI regulations in SwedenSweden, as one of the world’s leading centres of innovation in financial technology, offers a favourable environment for the development of payment service providers and payment organisations. The country’s regulatory environment is built around the Swedish Financial Supervisory Authority (Finansinspektionen, FI), which is responsible for licensing and supervision in the financial sector.

Process for obtaining a licence

To operate, a payment service provider must obtain a licence from the FI. The process involves submitting an application with a detailed application package, which must include a business plan, information on principals and beneficial owners, a description of the risk management system, and evidence of compliance with authorised capital requirements. Applicants must also demonstrate their ability to comply with regulatory requirements, including anti-money laundering and counter-terrorist financing measures.

Requirements for the applicant

  • Financial strength: The company must ensure that it has sufficient authorised capital to carry out its intended activities.
  • Governance and management: Qualified management with a clean business reputation and an adequate organisational structure are required.
  • Compliance: The Company is required to comply with all relevant legal and regulatory requirements, including those relating to data protection and anti-money laundering.

Amount of the required authorised capital

The minimum authorised capital for payment service providers in Sweden depends on the type of activity and can start from SEK 50,000 (about EUR 5,000) for registration as a payment agent and up to SEK 2 million (about EUR 200,000) for full-fledged payment institutions.

Application processing time

The processing time for an application for a payment service provider licence in Sweden varies, but on average takes between 3 and 12 months, depending on the complexity of the application and the FI’s workload. It is important to ensure that the documentation provided is complete and accurate to expedite the review process.

Conclusion

Sweden offers one of the most innovative and favourable regulatory environments for payment service providers in Europe, facilitating the development and growth of the fintech industry. Obtaining a licence requires thorough preparation and strict compliance. Successful candidates are given the opportunity to work in a progressive and dynamic financial market, offering innovative solutions in payment services.

PI regulations in Germany

PI regulations in Germany As one of Europe’s largest economies, Germany presents significant opportunities for payment service providers and payment organisations. The country is regulated by the Federal Financial Services Supervisory Authority (BaFin), which enforces high standards of safety, transparency and reliability in the financial sector.

Process for obtaining a licence

Payment service providers in Germany need to obtain a licence from BaFin to start operations. The application process requires the preparation and submission of an extensive set of documents, including a business plan, information on directors and beneficial owners, a detailed description of the risk management system and internal control procedures, as well as proof of financial strength and compliance with authorised capital requirements.

Requirements for the applicant

  • Financial strength: The supplier must demonstrate that it has sufficient authorised capital to support its operations.
  • Leadership and management: There should be evidence of management qualifications and reliability, as well as an effective organisational structure.
  • Regulatory compliance: The Company is required to comply with German and EU legislation, including anti-money laundering and counter-terrorist financing regulations and data protection requirements.

Amount of the required authorised capital

The minimum authorised capital for payment service providers in Germany depends on the type of services provided and can range from €50,000 to €125,000 for payment and electronic money institutions. For exact information, it is recommended to contact BaFin directly or specialised legal advisors.

Application processing time

The processing time for a licence application varies, but on average takes between 3 and 6 months, depending on the complexity of the application and BaFin’s workload. It is important to submit a complete and accurate set of documents to speed up the review process.

Conclusion

Germany offers a strict but fair regulatory environment for payment service providers, fostering innovation and consumer protection. Obtaining a licence requires rigorous preparation and strict compliance. Successful candidates gain access to one of Europe’s largest and most developed financial markets, offering significant opportunities for growth and development.

PI regulations in Spain

PI regulations in SpainSpain is one of the active participants in the development of financial technology and the payment services market in Europe. Payment service providers and payment organisations in the country are regulated by the National Bank of Spain (Banco de España) and are subject to European legislation, in particular the Payment Services Directive (PSD2), which aims to improve payment security and consumer protection.

Process for obtaining a licence

A payment service provider in Spain needs to obtain a licence from Banco de España to start operations. The process involves applying for and submitting a number of documents, including a business plan, information on principals and beneficial owners, a description of the risk management system, and evidence of compliance with authorised capital and financial strength requirements. Applicants must also demonstrate their ability to comply with regulatory requirements, including anti-money laundering and counter-terrorist financing measures.

Requirements for the applicant

  • Financial strength: Suppliers must ensure that they have sufficient authorised capital to support their operations.
  • Leadership and management: Qualified management with a clean business reputation is required.
  • Compliance: The Company is required to comply with Spanish and EU legislation, including anti-money laundering and counter-terrorist financing regulations.

Amount of the required authorised capital

The minimum authorised capital for payment service providers in Spain depends on the type of services provided and may vary. To register as a payment institution, the minimum authorised capital is usually between €20,000 and €125,000, depending on the volume of operations and services provided.

Application processing time

The processing time for a licence application is usually between three and six months, depending on the completeness and complexity of the documentation submitted and Banco de España’s current workload.

Conclusion

Spain offers a favourable environment for the development of payment service providers, fostering innovation and competition in the market while strictly complying with regulatory requirements to ensure the safety and transparency of financial transactions. Obtaining a licence requires thorough preparation and strict compliance. Successful candidates gain access to one of Europe’s largest markets, offering significant opportunities for growth and expansion in the payment services industry.

PI regulations in Italy

PI regulations in Italy Italy, with its dynamic financial sector and innovative fintech industry, creates an attractive environment for payment service providers and payment organisations. It is regulated by the Banca d’Italia and the Italian Markets and Competition Authority (Autorità Garante della Concorrenza e del Mercato, AGCM), which oversee compliance with European and national legislation, including the Payment Services Directive (PSD2), aimed at improving payment security and consumer protection.

Process for obtaining a licence

In order to operate as a payment service provider in Italy, it is necessary to obtain a licence from the Bank of Italy. The application process requires the preparation and submission of an extensive set of documents, including a business plan, information on directors and beneficial owners, a detailed description of the risk management system and internal control procedures, as well as proof of financial strength and compliance with the share capital requirements.

Requirements for the applicant

  • Financial strength: The company must demonstrate that it has sufficient authorised capital to support its operations.
  • Leadership and management: There should be evidence of management qualifications and reliability, as well as an effective organisational structure.
  • Compliance: The Company is required to comply with Italian and EU legislation, including anti-money laundering and counter-terrorist financing regulations.

Amount of the required authorised capital

The minimum authorised capital for payment service providers in Italy depends on the type of activity. For payment institutions, the minimum authorised capital is usually from EUR 125,000. For e-money institutions, the minimum capital may be higher and is determined depending on the volume of transactions and services provided.

Application processing time

The processing time for a licence application is usually between 3 and 6 months, but may vary depending on the completeness and complexity of the documentation submitted and the current workload of the Bank of Italy. It is important to submit a complete and accurate set of documents to speed up the review process.

Conclusion

Italy provides a favourable environment for payment service providers to develop and expand their activities in the European market. Strict but fair regulatory requirements ensure a high level of trust and security in the financial sector. Obtaining a licence requires thorough preparation and strict compliance. Successful candidates gain access to a dynamic market, fostering innovation and competition in payment services.

PI regulations in France

PI regulations in France In France, payment service providers and payment organisations are regulated under the strict supervision of the
French Prudential
Supervisory and Resolution Authority (Autorité de Contrôle Prudentiel et de Résolution, ACPR), which is part of the Bank of France. This regulatory environment is designed to ensure the stability of the financial system, protect consumers and prevent financial crime, including money laundering and terrorist financing.

Process for obtaining a licence

To commence operations, a payment service provider must apply to the ACPR for a licence. The application process requires the preparation and submission of an extensive set of documents, including a business plan, information on directors and beneficial owners, a description of the risk management system and internal control procedures, as well as proof of financial stability and compliance with authorised capital requirements.

Requirements for the applicant

  • Financial strength: The company must demonstrate that it has sufficient authorised capital.
  • Leadership and management: Qualified management with a clean business reputation is required.
  • Compliance: The Company is required to comply with French and EU legislation, including anti-money laundering and counter-terrorist financing regulations.

Amount of the required authorised capital

The minimum authorised capital for payment service providers in France varies depending on the type of services provided. In general, the minimum authorised capital for payment institutions ranges from €20,000 to €125,000, depending on the scope and specificity of the services provided.

Application processing time

The processing time for an application for a payment service provider licence in France is between 3 and 6 months. This period may vary depending on the completeness and complexity of the documentation submitted and the current workload of ACPR.

Conclusion

France provides a favourable environment for the development of payment service providers, emphasising the importance of innovation and consumer protection. Strict but fair regulatory requirements ensure a high level of confidence in the financial sector. Obtaining a licence requires thorough preparation and strict compliance. Successful candidates gain access to one of Europe’s largest and most developed financial markets, offering significant opportunities for growth and expansion in the payment services industry.

PI regulations in Ireland

PI regulations in IrelandIreland, with its favourable tax regime and open economy, is an attractive jurisdiction for many international and local fintech companies and payment service providers. Payment services and payment organisations in Ireland are regulated by the Central Bank of Ireland, which operates under European directives, including the Payment Services Directive (PSD2), which aims to increase security and innovation in the payment industry.

Process for obtaining a licence

Payment service providers in Ireland need to obtain a licence from the Central Bank of Ireland to commence operations. The process involves submitting an application with a detailed package of documents, which should include a business plan, information on the principals and beneficial owners, a description of the risk management system and internal controls, and evidence of compliance with the statutory capital and financial stability requirements. Information on anti-money laundering and anti-terrorist financing measures should also be provided.

Requirements for the applicant

  • Financial strength: Suppliers must demonstrate that they have sufficient authorised capital to start and maintain their operations.
  • Leadership and management: Qualified management with a good business reputation and an adequate organisational structure are required.
  • Compliance: The Company is required to comply with all relevant Irish and EU legislative and regulatory requirements.

Amount of the required authorised capital

The minimum authorised capital for payment service providers in Ireland depends on the type of services provided. For payment institutions, the minimum authorised capital usually starts at €20,000. However, the exact requirements may vary depending on the specific services provided and the scope of business.

Application processing time

The processing time for an application for a payment service provider licence in Ireland can vary, but on average is between 3 and 6 months. The processing time depends on the completeness and accuracy of the documentation submitted and the current workload of the Central Bank.

Conclusion

Ireland offers payment service providers a stable and supportive regulatory environment that encourages innovation and consumer protection. Obtaining a licence requires thorough preparation and strict compliance with regulatory requirements. Successful candidates have the opportunity to grow their business in one of Europe’s most dynamic and open markets, enjoying the benefits of a favourable tax regime and access to a wide range of financial and technological innovations.

PI regulations in Malta

PI regulations in Malta Malta, known for its favourable business climate and advanced financial technology regulation, offers unique opportunities for payment service providers and payment organisations. The country endeavours to be at the forefront of innovation and technological advancement by offering a transparent and efficient regulatory environment.

Regulatory structure

Payment services in Malta are regulated by the Malta Financial Services Authority (MFSA). The MFSA acts as the central authority responsible for the licensing and supervision of payment service providers and payment organisations in accordance with European and local regulations.

Licensing requirements

  1. Applicant: must be a legal entity registered in Malta. A detailed business plan describing the proposed activity, management structure, operational procedures and anti-money laundering measures must be submitted in order to obtain a licence.
  2. Share capital: The minimum amount of share capital depends on the type of licence, but for most payment institutions it ranges from €125,000 to €1,000,000.
  3. Application processing time: The application process can take from 3 to 6 months, depending on the complexity of the application and the information provided.

Oversight and compliance

Payment service providers in Malta are required to comply with strict risk management, anti-money laundering (AML) and counter-terrorist financing (CFT) requirements, and to protect customer data. The MFSA conducts regular audits to ensure compliance with applicable regulatory requirements.

Conclusion

The regulatory environment in Malta offers a favourable environment for the development and integration of innovative financial products and services. It is important to note that successfully obtaining a licence and operating a payment services business requires careful planning, knowledge of local legislative requirements and the support of competent legal and financial advisors.

For the most up-to-date information and advice, it is recommended that you contact directly the MFSA and qualified legal persons specialising in financial services regulation in Malta.

PI regulations in Luxembourg

PI regulations in LuxembourgThe Commission for the Supervision of the Financial Sector (CSSF) is the key regulator responsible for the licensing and supervision of payment service providers in Luxembourg. It is regulated under the European Electronic Money Directive (EMD) and the Payment Services Directive (PSD2), which aim to create a single market for payment services in the EU.

Licensing requirements

  1. Application: Applicant organisations must submit a detailed business plan to the CSSF, including a description of the services offered, risk analysis, organisational structure, and anti-money laundering and counter-terrorist financing measures.
  2. Authorised capital: The minimum authorised capital for payment service providers depends on the type of services provided and may vary. Generally, for most payment institutions it ranges from €125,000 to €2,000,000.
  3. Application Review Time: The CSSF application review process takes between 3 and 12 months, depending on the completeness and complexity of the documentation provided.

Oversight and compliance

Payment service providers are required to comply with a number of CSSF requirements, including rules on risk management, customer data protection, and AML/CFT requirements. The CSSF conducts regular inspections and audits to ensure compliance with these requirements.

Conclusion

Luxembourg offers a highly regulated, yet innovative and open environment for business development in the payment services industry. Successfully obtaining a licence requires careful planning, a thorough understanding of regulatory requirements and active engagement with the CSSF during the application process. It is recommended to engage professional legal and financial advisors specialised in financial regulation in Luxembourg to ensure compliance with all requirements and a successful market launch.

By consulting local information sources and official websites, such as the CSSF website, it is possible to obtain the most up-to-date and detailed information on the licensing procedure and requirements for payment services operations in Luxembourg.

Diana

“Europe is a reputable destination to start your EMI business, however, it is important to note that since Europe’s changed regulations, it is not that easy to get a license. Write me an email and I will share more details on the current regulations.”

Diana Pärnaluik

SENIOR ASSOCIATE

email2[email protected]

FREQUENTLY ASKED QUESTIONS

As of 2024, Lithuania is the leader in the European Union in terms of the number of issued electronic money licences (EMI - Electronic Money Institution). This fact is due to Lithuania's strategic decision to attract fintech companies and create favourable conditions for their development, including a relatively simple and fast licensing process, as well as support from the local regulator - the Bank of Lithuania.

Lithuania has become a popular destination for fintech companies seeking access to the single European payment space due to its openness to innovation, high level of IT infrastructure and competitive regulatory environment. This has attracted many international companies looking to register their operations in Lithuania and obtain an EMI licence to operate across the European Union.

As of 2024, the UK has traditionally led Europe in the number of Payment Institution (PI) licences issued. This was due to the active development of financial technologies and a favourable regulatory environment provided by the UK regulator, the FCA, the Financial Conduct Authority.

The UK has developed an attractive environment for fintech companies, including innovative regulatory approaches such as the 'regulatory sandbox', which allows new financial products and services to be tested in a controlled environment. This, in turn, has contributed to an increase in the number of companies seeking PI licences to provide payment services within the country and the European Economic Area (EEA).

However, it should be noted that after Brexit, when the UK left the European Union, licensing dynamics and regulatory processes may have changed, and other EU countries such as Lithuania and Estonia have actively competed to attract fintech companies by offering simplified licensing procedures and access to the single European market.

As of 2024, one of the European companies with an EMI (Electronic Money Institution) licence with the largest number of customers is Revolut. Founded in 2015 in the UK, Revolut has quickly become one of the leading players in the fintech market thanks to its user-friendly mobile app offering a wide range of financial services, including currency exchange at interbank rates, money transfers, cryptocurrency transactions and others.

Revolut was granted an EMI licence by the Bank of England, allowing the company to expand its services beyond the UK and offer them to clients in the European Union and beyond. Since then, the company has expanded aggressively, offering its services in many countries around the world.

The number of Revolut customers continued to grow and by the beginning of 2023, the company reported having millions of users worldwide. This makes Revolut one of the most successful and fastest growing fintech companies in Europe.

It is important to note that the dynamics of the fintech market are very fast and the position of companies can change. New players are constantly entering the market, offering innovative financial products and services, which fuels competition and improves the offerings for customers.

A company holding a European EMI (Electronic Money Institution) licence is authorised to provide a range of financial services within the European Union. This licence allows organisations to issue electronic money and offer related services, making them key players in the fintech services market. Here are some of the main services that a company with an EMI licence can provide:

  1. E-money issuance: This includes pre-paid cards and e-wallets that users can use to make payments and transfer money.
  2. Acceptance and execution of payment orders: Companies may process payments and money transfers on behalf of customers, including direct debits, credit transfers, payment card payments and any other commercial transactions.
  3. Payment account management: Providing customers with accounts to store electronic money and make payments.
  4. Making payment transactions via mobile phones or any other electronic device: This includes transferring money to or from an e-wallet and using mobile apps to manage finances and make payments.
  5. Money Transfers: Providing international money transfer services and instant transfer services within the EU.
  6. Execution of payment transactions where the funds are protected by a credit line for the payment service user: For example, issuing credit cards or providing short-term loans within the payment service.
  7. Providing consulting and information services related to payments: For example, consulting on payment security issues, analysing customer payment flows and proposing optimisation of payment processes.

The EMI licence gives companies the opportunity to operate within a single European market, offering their services in all European Union member states, thanks to the 'single passport' principle. This gives companies significant advantages in scalability and access to a wide market of consumers and businesses in Europe.

A company with a European PI (Payment Institution) licence is authorised to provide a wide range of payment services within the European Union. This licence under the Payment Services Directive (PSD2) allows organisations to carry out payment related activities without the need to obtain full banking status. Here are some of the key services that a company with a PI licence can provide:

  1. Acceptance and execution of payment orders: This includes services for processing direct debits, credit transfers, payments via payment cards, and any other payment instruments.
  2. Performing payment transactions, including transfers of funds to the user's payment account with the same or another organisation: For example, debit or credit card transactions.
  3. Performing payment transactions where the funds are covered by a credit line for the user of the payment service: This may include services related to the issuance and maintenance of credit cards.
  4. Issuing payment instruments and/or accepting payments: For example, providing customers with prepaid cards or other forms of electronic payment instruments.
  5. Money transfers: Provision of international money transfer services and instant transfer services within the European Union.
  6. Payment services made via mobile phones or any other electronic devices: This includes the ability to make payments and fund transfers via mobile apps or online banking.
  7. Intermediary payment services: For example, services that allow users to make payments to online shops through payment gateways or platforms that provide payment processing on behalf of merchants.

Companies with a PI licence can offer these services in any country in the European Union using the "single passport" mechanism, which allows them to expand their operations and provide services outside the country in which the licence was obtained without the need to obtain additional national licences in each individual country.

A company with a European AISP (Account Information Service Provider) licence provides services related to access to information about a customer's account at a bank or other financial institution. This licence was introduced as part of the Payment Services Directive (PSD2) of the European Union, which aims to increase competition and innovation in the financial sector, as well as improve consumer protection. Here are the main financial services that AISP can provide:

  1. Providing consolidated account information: AISPs can provide users with an overview of information on their various bank and financial accounts in one place. This allows clients to better manage their finances and see an overall picture of their income, expenses and account balances.
  2. Analysing financial data: Companies can analyse account information to provide personalised financial advice such as budgeting, investment and savings advice.
  3. Account monitoring and notifications: AISPs may offer account monitoring services, such as notifying customers of significant account changes, upcoming payments, or the achievement of certain financial goals.
  4. Improved user experience in financial applications: Providing account data through an API (application programming interface) can improve functionality and user experience in third-party financial applications and services, such as personal finance management applications or accounting software.
  5. Credit and financial planning assistance: Using the data provided by AISPs, credit institutions can more accurately assess the creditworthiness of customers and offer more personalised credit products. Also, this data can be used to create more accurate financial plans and strategies.

The AISP licence does not allow a company to initiate payments or access customer funds. Its main function is to provide access to account information with the consent of the customer, thus contributing to more innovative and customer-centric financial services.

The minimum share capital for a company applying for an EMI (Electronic Money Institution) licence in Europe depends on the specific requirements of European Union legislation and may be further specified by the national regulatory authorities in each EU Member State. According to the EU Electronic Money Directive (2009/110/EC) and the Payment Services Directive (PSD2 - Directive (EU) 2015/2366), which regulate EMIs, the minimum authorised capital for EMIs is set at:

  • The minimum required authorised capital is €350,000.

This is a basic requirement, but specific conditions and requirements may vary depending on the size of the proposed business, the services offered and the company's risk assessment. Regulators may also require additional financial guarantees or additional capital commensurate with the scale of operations and level of risk.

Importantly, companies seeking to obtain an EMI licence must undergo a thorough regulatory due diligence process, which includes a review of the business model, management structure, operating procedures, anti-money laundering and counter-terrorist financing measures, and the company's ability to ensure the safety and security of customer funds.

Companies interested in obtaining an EMI licence are advised to seek advice from qualified legal and financial advisors to prepare the necessary documentation and successfully complete the licensing process in the chosen EU country.

The minimum share capital for a company applying for a payment institution licence (PI - Payment Institution) in Europe is determined in accordance with the Payment Services Directive (PSD2 - Directive (EU) 2015/2366). The amount of the authorised capital depends on the type of payment services to be provided. Here are the main authorised capital requirements for different categories of PI activities:

  1. For payment institutions offering services other than the execution of payment transactions or money transfers, the minimum authorised capital is €20,000.
  2. Payment institutions performing payment transactions (which do not involve the opening of payment accounts and for which funds are covered by a credit line) require a minimum authorised capital of €50,000.
  3. For payment institutions offering money transfer services or any other payment services, the minimum authorised capital is €125,000.

These amounts are the starting share capital requirements for obtaining a PI licence. Depending on the volume of operations and the assessment of the risks associated with the company's activities, the regulator may require an increase in the authorised capital.

Regulators may also assess a company's business model, management structure, anti-money laundering (AML) and counter-terrorist financing (CFT) measures, and its ability to safeguard customer funds and data. Companies seeking a PI licence should prepare thoroughly for the licensing process, possibly involving specialist legal and advisory services, to ensure compliance with all regulatory requirements.

The timeframe for processing an application for an EMI (Electronic Money Institution)
licence in Europe can vary from country to country and from regulator to regulator. In accordance with the Payment Services Directive (PSD2) and the national legislation of EU Member States, regulators have set timeframes for processing applications, which are usually:

  • From 3 to 12 months after submitting a complete set of documents.

Most regulators try to adhere to a timeframe in the region of 3-6 months to complete the application process, but the complexity of the application, the quality and completeness of the documentation provided, and the need for additional clarifications or changes may result in a longer timeframe.

To speed up the process and increase the chances of successfully obtaining an EMI licence, companies are advised to:

  • Thoroughly prepare for the application process, including the development of a detailed business plan, risk management policies, anti-money laundering (AML) and counter-terrorist financing (CFT) measures, and an information security management system.
  • Ensure the completeness and accuracy of the documents provided.
  • It may be possible to use the services of specialist legal and consultancy firms with experience of working with regulators and familiarity with EMI licensing requirements in the chosen country.

It is also worth bearing in mind that once an EMI licence has been granted, companies are subject to regular regulatory oversight, which includes reporting and possible inspections to check compliance with applicable regulations and standards.

The processing time of an application for a Payment Institution (PI) licence in Europe depends on the specific regulator in each EU Member State and may vary depending on the complexity of the documents submitted, the efficiency of the interaction between the applicant and the regulator, and the completeness and accuracy of the information provided. Under the Payment Services Directive (PSD2), regulators usually have a set timeframe for processing such applications.

Generally speaking:

  • The processing time of an application for a PI licence in Europe can be between 3 and 12 months after submission of a complete set of documents.

More precise timelines may be determined by the national legislation of each EU country and the individual practices of the regulators. Some regulators may set specific deadlines for completing certain stages of the licensing process, including preliminary assessment of the application, requests for additional information and final decision.

To increase the chances of obtaining a PI licence quickly and successfully, companies are advised to:

  • Thoroughly prepare and submit a complete and accurate documentation package that complies with all regulatory requirements.
  • Include a detailed business plan, a description of internal procedures and policies, including anti-money laundering (AML) and counter-terrorist financing (CFT) measures, and a risk management framework.
  • In case of possible requests for additional information or clarifications from the regulator, promptly and fully provide the requested data.

Working with law and advisory firms experienced in obtaining licences in the financial sector and familiar with local regulatory requirements can make the licensing process much easier.

In Europe, the regulator for EMI (Electronic Money Institution) and PI (Payment Institution) licences are the national competent authorities of each European Union (EU) member state. These authorities are responsible for the supervision and regulation of financial services under European legislation, including the Payment Services Directive (PSD2) and the Electronic Money Directive.

Regulators may have different names in different countries. Here are some examples:

  • In the UK (although it is not a member of the EU after Brexit, many companies are still interested in information on this country), regulation is handled by the Financial Conduct Authority (FCA).
  • In Germany, the regulator is the Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht, BaFin).
  • In France, the Financial Markets Supervisory Authority (Autorité de contrôle prudentiel et de résolution, ACPR).
  • In Lithuania, the Bank of Lithuania (Lietuvos bankas), which is actively attracting fintech companies due to its open regulatory policy.
  • In Luxembourg, the Commission de Surveillance du Secteur Financier (CSSF).

Each national regulator has its own requirements and procedures for obtaining EMI and PI licences. They are responsible for assessing applications, issuing licences, and for supervising and monitoring the activities of licensed institutions to ensure that they comply with legal and regulatory requirements.

Yes, companies in Europe holding electronic money (EMI) and payment institutions (PI) licences are required to have professional indemnity insurance. This requirement is established under the Payment Services Directive (PSD2), which aims to strengthen payment security and the protection of user funds, as well as to improve consumer protection and promote the development of a more competitive and integrated financial market in the European Union.

Professional indemnity insurance is designed to protect both the company itself and its clients in the event of financial losses caused by errors, omissions, unintentional misrepresentation or other professional failings in the provision of services. This includes cases related to non-compliance with contractual obligations, errors in payment processing or incorrect provision of information to clients.

Insurance coverage requirements may vary depending on the country, the size of operations and the specific risks associated with the company's business. Regulators may set minimum coverage amounts necessary to comply with legislation and ensure that the interests of all parties are adequately protected.

Companies should carefully consider the regulatory requirements in their country of incorporation and ensure that they have professional indemnity insurance that meets both the minimum legal requirements and the needs of their business. In some cases, it may be necessary to consult with specialised insurance agents or brokers to select the most appropriate insurance product.

RUE customer support team

Milana
Milana

“Hi, if you are looking to start your project, or you still have some concerns, you can definitely reach out to me for comprehensive assistance. Contact me and let’s start your business venture.”

Sheyla

“Hello, I’m Sheyla, ready to help with your business ventures in Europe and beyond. Whether in international markets or exploring opportunities abroad, I offer guidance and support. Feel free to contact me!”

Sheyla
Diana
Diana

“Hello, my name is Diana and I specialise in assisting clients in many questions. Contact me and I will be able to provide you efficient support in your request.”

Polina

“Hello, my name is Polina. I will be happy to provide you with the necessary information to launch your project in the chosen jurisdiction – contact me for more information!”

Polina

CONTACT US

At the moment, the main services of our company are legal and compliance solutions for FinTech projects. Our offices are located in Vilnius, Prague, and Warsaw. The legal team can assist with legal analysis, project structuring, and legal regulation.

Company in Lithuania UAB

Registration number: 304377400
Anno: 30.08.2016
Phone: +370 661 75988
Email: [email protected]
Address: Lvovo g. 25 – 702, 7th floor, Vilnius,
09320, Lithuania

Company in Poland Sp. z o.o

Registration number: 38421992700000
Anno: 28.08.2019
Phone: +48 50 633 5087
Email: [email protected]
Address: Twarda 18, 15th floor, Warsaw, 00-824, Poland

Regulated United Europe OÜ

Registration number: 14153440–
Anno: 16.11.2016
Phone: +372 56 966 260
Email:  [email protected]
Address: Laeva 2, Tallinn, 10111, Estonia

Company in Czech Republic s.r.o.

Registration number: 08620563
Anno: 21.10.2019
Phone: +420 775 524 175
Email:  [email protected]
Address: Na Perštýně 342/1, Staré Město, 110 00 Prague

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