Get Electronic Money Licenses in European Countries
EMI license is an authorization to issue electronic currency for legal entities and individuals. When registering this type of license, a company receives the rights that classic payment companies use. Such an organization will be able to make offline/online payments and provide sub-accounts within a bank account, which provides the ability to create electronic wallets and provide individual IBANs.
Users can use the exchange of cash for electronic money issued by the company and use financial storage services. In addition, users will be able to pay for services or goods with electronic currency or perform various payment operations.
It is possible to register an EMI license almost all over the world, but the most popular is the EU license. They allow you to cover a large market, using the reliable and stable reputation of the European economy, and also provide access to SEPA translations.
The most popular countries in jurisdictions where this license can be registered are Lithuania, the United Kingdom, Malta, the Czech Republic, Cyprus, etc.
What gives an EMI license
- Payment system management
- Provision and implementation of payment services/money remittance
- Carrying out activities with the provision of loans (using equity capital only)
The maximum turnover for 12 months on sub-accounts of users of the payment system cannot exceed 36 million EUR (based on 3 million EUR per month)
The payment institution has the right to provide services only in the territory of the country of registration. However, it does not prohibit having Clients from any country in the world.
- Payment system management
- Provision and implementation of payment services/money remittance
- Carrying out activities with the provision of loans (using equity capital only)
The maximum turnover on sub-accounts of users of the payment system is unlimited
The payment institution has the right to provide services through out the EEA and have the users from any country in the world.
- Emission of electronic money
- Services allowing the use of issued electronic money as a payment instrument
- Exchange of emitted electronic money for fiat currency
- Payment system management
- Provision and implementation of payment services / money remittance
- Carrying out activities with the provision of loans (using equity capital only)
What is Electronic Money Institution
EMI (Electronic Money Institution) is a legal company or a person who has the right to create electronic money, quasi-money, and in addition, can make payments on these assets.
Many people confuse an EMI with a classic bank, but this is a misnomer. The main difference between EMIs and standard banks is that an Electronic Money Institution has no legal right to hold deposits or issue loans. They were originally invented to pay and service businesses and individuals.
The limitation on sub-account transactions, in most cases, depends on the level of customer identification and differs depending on the specifics of the jurisdiction. Statutory provisions that govern this issue are constantly changing around the world, so it is recommended to conduct separate clarification studies for each new project.
Full list of Capabilities
- Emission of electronic money
- Possibility of using e-money by users as a unit of account for payment for services/goods of third parties
- Exchange of emitted electronic money for fiat currency
- Opening sub-accounts for Clients inside a corporate account of a Payment Service Provider
- Services allowing users placing cash on a current account
- Services allowing users to withdraw cash from a current account
- Execution of payment transactions and money transfers/money remittance (including between payment accounts of users of a payment institution)
- Account information services
- Provision of loans. The loan cannot be provided from funds that have been entrusted to the payment institution for the payment transaction and the equity capital must be equivalent to the total amount of the loan provided. The loan must be repaid by the borrower within one calendar year. Issuance and/or purchase of payment instruments
- Assign existing payment bank cards to Client sub-accounts and issue cards of major vendors (VISA, MC)
The difference between EMI and PI
PI (Payment Institution) license allows companies to provide financial and intermediary services not only for Internet business. For Example opening and closing of accounts, provision of account replenishment services by other payment systems; withdrawal of funds from individual and personal accounts; various payment operations between customer accounts; money transfers; creation of own and involvement of third-party payment instruments, etc.
The main difference between EMI and PI is that EMI has the right to issue electronic currency and store client money for a longer period, while PI does not have the right to issue electronic funds. EMI can produce payment cards, e-wallets, and other payment instruments that provide for the storage of client funds.
The list of services of the electronic payment system corresponds to the services offered by traditional banks. In addition, EMI allows the use of innovative developments and the speed of transactions, which implies a reduction in payment fees and leads to an increase in customer loyalty.
Business climate
Currently, the Czech Republic and Lithuania are the most attractive jurisdictions in the EU for establishing a company in order to obtain an electronic money institution or payment service provider license, as evidenced by the map above. By 2021, 40 PSP / EMI and 104 small-scale payment institutions are registered in the Czech Republic, while in Lithuania there are 112 full-scale payment systems. The growth in Lithuania has almost doubled since 2018 when the number of full-scale PSP / EMI was 63.
Interest in the Czech Republic and Lithuania jurisdictions caused by the relatively low cost of labor in the EU, a convenient regulatory system and transparent tax system. The speed of processing the application by the regulator is also significant. While in Germany, Malta and other EU jurisdictions, the process can take from 6 to 12 months, in the Czech It should also be noted that in Lithuania an application for a license could be submitted without setting up a company.
Sequence of the steps
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