Wide range of payment services. Payment cards issue. Equity capital – EUR 350 000. Licensing time – up to 3 months.
Licensed Electronic Money Institution allows provide wider range of financial services comparing with Payment Institution designed for instant payment processing. Electronic Money Institution licensed in one European Union (EU) member state opens up business opportunities to act and provide services in all other EU/EEA countries, enjoying the benefits of a Common Market without any restrictions and additional requirements.
Difference between Payment and Electronic Money Institution
Electronic Money (E-money) defined by European Central Bank as an electronic store of monetary value on a technical device that may be widely used for making payments to entities other than the e-money issuer. The device acts as a prepaid bearer instrument, which does not necessarily involve bank accounts in transactions. Directive 2009/110/EC established legal basis for e-money issuing in the European Union (EU).
The practical difference between Electronic Money (E-money) and Payment Institution (PI) is that E-money institutions in addition to the services provided by PI are entitled to issue Electronic Money. It means that Electronic Money Institutions allowed to store clients’ funds for a longer period what Payment Institutions usually not allowed. E-money license allows issue of payment cards, e-wallets and other payment instruments requiring storage of the client funds.
Services provided by Electronic Money Institution
Electronic Money Institution license is the right decision for the payment service providers planning wider range of services than just instant payment processing.
- Services enabling cash to be placed on a payment account.
- Services enabling cash withdrawals from a payment account.
- Execution of payment transactions, including transfers of funds on a payment account with the payment service provider of the payment service user or with another payment service provider: execution of direct debits, including one-off direct debits, execution of payment transactions through a payment card or a similar device and/or execution of credit transfers, including standing orders.
- Execution of payment transactions where the funds are covered by a credit line for a payment service user: execution of direct debits, including one-off direct debits, execution of payment transactions through a payment card or a similar device and/or execution of credit transfers, including standing orders.
- Issuing and/or acquiring of payment instruments.
- Money transfers.
- Execution of payment transactions where the consent of the payer to execute a payment transaction is given by means of any telecommunications terminal equipment, digital or IT device and the payment is made to the telecommunications network or IT system operator, acting only as an intermediary between the supplier of the goods or services and the payment service user.
- Payment Initiation Service (PSD2 implementation).
- Account Information Service (PSD2 implementation).
- Issuing of Electronic Money.
Lithuania has already implemented EU Second Payment Services Directive (PSD2) allowing Payment Initiation Service (PIS) – initiation of a payment order from the client bank account at the request of the client from the payment account held at another payment service provider (bank). PSD 2 also allows E-money Institution provide Account Information Service (AIS) accessing consolidated information from the client accounts held by at another payment service providers (banks) and have overall view of client financial information.
ECOVIS experience in finance institution licensing
Being part of ECOVIS International consulting network present in more than 60 counties around the world ECOVIS ProventusLaw currently considered as the most experienced financial advisor in Lithuania. During the period of last 12 months, ECOVIS licensed in Lithuania more than 10 Payment and Electronic Money institutions including big names deVere and Instaremsetting up their European operations centres in Vilnius. ECOVIS ProventusLaw provides all the necessary services for the Payment Institution licensing, including preparation of licensing documentation, representation at the Bank of Lithuania during the licensing procedure, company incorporation, office registration, advice on IT, HR, compliance and other issues rising during the incorporation of payment business in Europe. After the licensing procedure completed, ECOVIS offers accounting, reporting, audit, compliance and legal services for the operational business.
More about FinTech companies registration and licensing in Lithuania – http://ecovis.lt/fintech/.