Financial license for payment gateways - read in the blog of the company COREDO

Nikita Veremeev

22.11.2025 | 6 min read

Updated: 22.11.2025

A payment system license is an official authorizing document issued by a financial regulator (the central bank or a specialized authority) that confirms the right of a payment system operator or payment gateway to carry out licensed payment operations, hold and process clients’ funds, and issue electronic money. It is based on the regulatory framework of payment systems designed to ensure financial security, transparency of settlements, and protection of users’ interests.

In the practice of COREDO we have repeatedly encountered situations where entrepreneurs underestimated the regulatory function of the license, perceiving it as a formality. In reality, a license – is not only the legal basis for conducting activities, but also a key element of financial regulation that determines access to banking infrastructure, international payment systems (Visa, MasterCard, UnionPay), as well as to technology partners and investors.

Licensing: functions and benefits

Licensing of payment operations performs three strategic tasks:

Prevention of illegal circulation of financial resources: A license requires the implementation of a comprehensive AML/CTF policy, which minimizes the risks of money laundering and terrorist financing.
Stability of the settlement infrastructure: Regulatory requirements for authorized capital and the financial stability of the payment system operator ensure the reliability and uninterrupted operation of the payment gateway.
Competitive advantages: Having a payment system license significantly increases customer trust, allows cooperation with leading banks, integration with international payment services, and expansion of the business’s geographic reach.

The solution developed by COREDO for one of its European clients not only enabled the obtaining of an EMI license, but also the establishment of a partner network with leading EU banks, which became a catalyst for scaling the business into Southeast Asian markets.

License requirements for payment gateways

Illustration for the section «License requirements for payment gateways» in the article «Financial license for payment gateways»

Financial requirements and share capital

The key barrier to obtaining a payment system license is the financial requirements. In different jurisdictions the minimum share capital for a payment license varies significantly: in Estonia: from €350,000 for an EMI license, in the Czech Republic: from €125,000, in Cyprus – from €200,000. For a Payment Service Provider license (PSP) requirements may be lower, but the payment operator’s financial stability and the transparency of funding sources are always assessed.

COREDO’s practice confirms that regulators pay special attention not only to the amount of share capital, but also to its origin, ownership structure and financial forecasts. It is important to prepare in advance justification of the lawful origin of funds and a detailed business plan to obtain a payment license.

Organizational and personnel requirements

The company’s structure and the qualifications of the payment system’s managers: another critical aspect. Regulators require:

A transparent ownership and governance structure.
Qualified directors and managers with experience in financial services and payment operations.
The presence of a separate branch or virtual office in the licensing jurisdiction (for example, for Singapore: a mandatory local director and a registered legal address).

In one of COREDO’s cases for an Asian client we built an organizational structure taking into account residency and qualification requirements, which allowed the owners’ and managers’ integrity checks to be passed on the first attempt.

AML/KYC requirements and data protection

Modern regulation of payment systems is impossible without strict compliance with AML/CTF policies and the implementation of KYC procedures. The payment system operator must:

Develop and implement internal rules for combating money laundering.
Ensure client identification and verification (KYC).
Organize the protection of payment system users’ data in accordance with international standards (GDPR, PDPA, etc.).
Implement a system for monitoring suspicious transactions and managing fraud risks.

COREDO’s practical experience shows that inadequate handling of these aspects is the main reason for delays and license refusals.

Process of obtaining a payment system license

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Preparation of documents and business plan

The first stage is preparing the complete package of documents for registering a payment system. It includes:

Constituent documents, company charter, meeting minutes.
Financial statements and a business plan for obtaining the payment license.
Documents confirming the lawful origin of funds.
AML/CTF policies, internal KYC and data protection regulations.
Certificates confirming the integrity and reliability of owners and management.

COREDO’s experience shows that a well-prepared business plan with financial forecasts and a scaling strategy significantly speeds up the application review process.

Submission of the application and interaction with the regulator

The application is submitted to the authorized financial authority or the central bank of the relevant jurisdiction. Regulatory requirements for payment systems include:

Verification of the integrity and reliability of the payment system owners (Due Diligence).
Analysis of the company structure and management qualifications.
Assessment of AML/CTF policies’ compliance with international standards.

During the review process, the regulator may request additional documents, clarifications on the business model or capital structure. The COREDO team assists clients at every stage, including preparing responses to regulator requests and participating in interviews.

Timelines and stages of the application review

The timeline for obtaining a payment license depends on the jurisdiction and the complexity of the structure. On average:

Document preparation: 1–2 months.
Application review and integrity checks: 3–6 months.
Interaction with the regulator and audit of the payment system: up to 9 months.

In some cases (for example, when document legalization is required or with an international structure) timelines may increase. A solution developed by COREDO for one of its clients in Singapore reduced the licensing timeframe from 12 to 7 months due to careful preparation and proactive interaction with the regulator.

Licensing in the EU, Asia and Africa: specifics

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EMI license in Europe: requirements

In the EU the main form of licensing is the EMI license (Electronic Money Institution), which allows issuing electronic money, conducting payment transactions and integrating with SEPA, SWIFT, Visa, MasterCard. Main requirements:

Minimum share capital: from €350,000.
Compliance with payment activity regulations (PSD2, EMD2).
Strict AML requirements/KYC and personal data protection (GDPR).

The COREDO team carried out projects to obtain EMI licenses in Estonia and the Czech Republic, where special attention is given to financial stability and the transparency of the company’s structure.

Key differences between Asian and African markets

In Asia (for example, in Singapore) requirements for payment licenses are regulated by the Monetary Authority of Singapore (MAS). Key features:

Mandatory presence of a local director and a registered address.
Minimum share capital: from SGD 100,000 for a standard license.
Strict control over AML/CTF policies and cross-border payments.

In Africa, regulation is more fragmented, but the trend toward tightening requirements for financial security and data protection is clear. In COREDO’s practice we have encountered the need to adapt business models to local specifics, including currency control and data localization requirements.

Choosing a jurisdiction for registering a payment operator

jurisdiction choice – a strategic decision affecting cost, timelines and scaling potential. It is important to consider:

Financial and regulatory conditions (requirements for capital, structure, reporting).
The possibility of opening a virtual office for the payment license.
The reputation of the jurisdiction among international banks and partners.

COREDO’s experience shows that for startups and companies focused on international markets, optimal choices often are Cyprus, Estonia, the Czech Republic or Singapore due to the balance between requirements, licensing speed and access to payment infrastructure.

Licensed payment gateways: technological and operational aspects

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Integration and security of payment systems

A modern payment gateway is not just software but a comprehensive payment infrastructure integrated with banks, international payment networks and third-party services. Critical aspects:

API integration with banks and partners.
Protection of payment system users’ data using encryption and multi-layer authentication.
Cybersecurity of payment systems, a mandatory requirement for passing audits and meeting regulator requirements.

COREDO implements solutions that allow clients not only to comply with PCI DSS standards but also to ensure resilience to DDoS attacks and fraud attempts.

Choosing partners and infrastructure

The successful operation of a payment gateway is impossible without reliable technology partners and infrastructure providers. Key points:

Assess partners’ experience and reputation in the market.
Choose cloud payment solutions that provide scalability and fault tolerance.
Enter into transparent agreements with providers, taking into account the regulator’s requirements for data storage and processing.

In one of COREDO’s projects for a British client, integration with multiple providers was implemented, which made it possible to ensure uninterrupted operation of the payment system even during a sharp increase in load.

Technology compliance with regulatory requirements

The technological infrastructure must not only provide fast and convenient payments but also meet the requirements for risk management in payment systems:

Implementation of a system for monitoring suspicious transactions.
Regular vulnerability testing and security audit.
Compliance with payment operation regulations and cybersecurity standards.

COREDO’s experience shows that integrating compliance tools at the design stage of a payment gateway reduces the costs of subsequent adaptation and minimizes regulatory risks.

Risks and risk management when working with a payment license

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Key risks for payment operators

Payment system operators face three groups of risks:

Operational risks: service disruptions, technical errors, human factors.
financial risks: insufficient capital, losses due to fraud.
Reputational risks: data breaches, regulatory non-compliance.

The COREDO team helps clients build internal control and business continuity systems to minimize the impact of incidents.

AML/KYC compliance and data protection

To meet AML/CTF requirements and protect personal data, it is necessary to:

Continuously update internal policies and procedures.
Conduct regular training for staff.
Use automated KYC procedures and transaction monitoring systems.

In one of COREDO’s cases for the Asian market, we implemented an automated customer verification module, which reduced the rate of false positives and sped up the onboarding process.

Monitoring and auditing of the payment system

Effective compliance monitoring includes:

Conducting regular audits of the payment system.
Monitoring changes in regulatory acts and adapting internal procedures.
Planning crisis management and recovery after failures.

The solution implemented by COREDO for one of its clients in the EU not only allowed them to pass an external audit without remarks, but also increased trust from partner banks.

Practical recommendations for entrepreneurs

How to prepare for licensing

Assemble a team with relevant experience and qualifications.
Prepare a complete set of documents, including a business plan, AML/KYC policies, and proof of funding sources.
Conduct preliminary due diligence on owners and executives.

How to choose a jurisdiction and a partner

Assess capital requirements, company structure, and reporting obligations across different countries.
Consider opening a virtual office for the payment license.
Choose technology partners with experience integrating payment systems and complying with security standards.

How to minimize risks and pursue long-term development

Implement a risk management system in payment systems with regular audits and monitoring.
Plan the scaling of the payment system with the requirements of new markets in mind.
Invest in team training and updating compliance procedures for the long-term development of the payment system.

Conclusions and next steps

Prepare a complete package of documents and a business plan in line with regulator requirements.
Choose an appropriate jurisdiction, taking into account financial and regulatory conditions.
Ensure AML compliance/KYC and protection of user data.
Take care when selecting technology partners and infrastructure.
Plan risk management and audits for sustainable business development.

Licensing stage	Main requirements	Timeframe (approx.)	Key documents
Document preparation	Articles of association, business plan, financial reports	1-2 months	Articles of association, minutes, financial documents
Application submission and review	Due diligence checks, AML/KYC	3-6 months	Application, AML/KYC documents
Interaction with the regulator	Responses to inquiries, payment system audit	Up to 9 months	Additional documents, audit reports
obtaining the license	Official authorization, registration	After successful completion	License, authorization documents

If you want to go through the payment system licensing process without unnecessary risks and delays, the COREDO team is ready to become your strategic partner at every step: from choosing a jurisdiction to building a scalable payment infrastructure.