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Techfoliance | 20 November 2017

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[NEW] All you need to know about Fintech licensing in Lithuania

[NEW] All you need to know about Fintech licensing in Lithuania

Lithuania now position itself as a strategic point of access for the Fintech companies considering to penetrate the European market.

FINTECH LICENSING LITHUANIA

  • A company holding payments licenses, is entitled to provide any or all payment services identified in Annex 1 of PSD I.

    Two types of the payments licenses:

    (i) Restricted scope:

    Valid only in Lithuania and the average monthly volume of the payment transactions shall not exceed EUR 3 million within the last 12 months;

    (ii) Full scope:

    A company holding a full scope payments license may provide payment services across the EEA (no volume limits apply) under the freedom of establishment or freedom of services. The minimum required equity capital for the full scope payment institution varies from EUR 20 000 to EUR 125 000 (depending on the payment services to be offered).


  • A company holding e-money license is entitled to issue, circulate and redeem e-money as well as to provide any or all of the payment services identified in Annex 1 of PSD I.

    Two types of the e-money license are available:

    (i) Restricted scope:

    Valid only in Lithuania and the average monthly amount of the unpaid e-money shall not exceed EUR 900 000 within the last 6 months;

    (ii) Full scope:

    A company holding a full scope e-money license may provide services across the EEA (no volume limits apply) executing freedom of establishment or freedom of services. The minimum required equity capital for the full scope e-money institution is not less than EUR 350 000.

    Payment and e-money institutions can join SEPA payment infrastructure and offer their clients personal accounts with IBAN codes.

    (iii) Tips to apply:

    Payments licencing and e-money licensing procedures include, amongst others:

    1. Assessment of the institutions’ shareholders (applicable for the full scope licence only),
    2. Prepare business plan and program of activities,
    3. Have an appropriate management, internal organisation, processes, risk management and internal control procedures to ensure sound and prudent activities of the payment or e-money institution.
    4. Documents needed for the licensing may be submitted in English language.

    The regulator is very proactive in granting licenses. A decision may be adopted in only 3 months which is 2-3 times faster compared to other EEA countries.


  • As of 1 January 2017, a new concept of a specialized bank has been introduced into the Lithuanian legal framework. Specialized banks are equivalent to full services banks with the license capable of being passported across the EU, except that:

    (i) Initial capital:

    The requirement for a specialized bank is 5 times lower than for full service banks (EUR 1 million v. EUR 5 million);

    (ii) Limits:

    The specialized banks cannot provide investment services or manage investment funds, closed-end investment companies, pension funds or engage in the activities of a similar nature.

    (iii) Tips to apply:

    The licensing application is to be submitted to the Bank of Lithuania, however, the ultimate decision is taken by the European Central Bank. The license of a specialized bank should be granted within 6 months (extensions are possible, however up to the maximum of 12 months).



The information shared in this article has been provided by Ellex Valiunas, a Vilnius-based law firm that help FinTech companies to set up a corporate framework for their business in Lithuania and assist them throughout the licensing process. Know more 

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