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Licensing

NPI is a national payment institution that can provide a full range of payment services. Unlike an SPI (small payment institution), an NPI registered in Poland can operate throughout the European Union without the need for additional licensing. Accordingly, the extension of the SPI licence to NPI allows to significantly expand the scope of activities and increase the number of services provided. Licensing of financial institutions in Poland is handled by the Financial Supervision Authority (KNF).

 

Business features and benefits of an NPI licence

As mentioned above, NPI can provide payment services throughout the EU, so its activities are more strictly regulated. But the possibilities of the national payment institution are also broader. Among them we can mention:

  • wider range of services provided;
  • absence of statutory limits on transactions;
  • absence of restrictions on the amount of funds stored on the client’s account.

It is possible to expand the capabilities of a small payment institution by applying for an NPI licence both immediately after its registration/purchase and in the course of its operation. In accordance with legal requirements, SPIs are obliged to apply for an NPI licence as soon as their transaction limits exceed EUR 1,500,000 per month. The filing period is 30 days. The SPI can then immediately operate as an NPI without waiting for formal confirmation of the updated status throughout the application process and beyond.

SPI or Small Payment Institution in Poland is engaged in the provision of a wide range of payment services. The law considers such activities as regulated, therefore it requires a licence from the Polish Financial Supervision Authority (KNF). The SPI licence is a convenient solution for small companies, start-ups wishing to enter the financial market, to test their technical solutions and the demand for services within one jurisdiction.

 

Advantages of obtaining an SPI licence in Poland

Having an SPI licence allows a company to provide a limited range of payment services in Poland, but the regulatory framework for small payment organisations is less strict than for national payment organisations. This simplifies registration and subsequent reporting. In addition, fintech companies will have no problem finding qualified employees in Poland, whose salaries are lower than the European average.

An important advantage of obtaining an SPI licence is the absence of minimum start-up capital requirements. This allows even small start-ups from the Fintech industry to start operating in Europe.

Kyrgyzstan is one of the few countries where activities related to cryptocurrency assets are regulated at the state level. Since mid-2022, the country has implemented the law “On Virtual Assets”, which outlines the rules for such activities and also recognizes the right of individuals and legal entities to own cryptocurrencies and use them in accordance with regulatory standards.

The Agency for the Development of Information Technologies and Communication is the official body regulating the cryptosphere in Kyrgyzstan. Several types of crypto licences are available in this jurisdiction:

  • crypto trading operator (crypto exchange);
  • currency exchange operator (crypto exchanger);
  • mining operator.

Additionally, in Kyrgyzstan the public issue and circulation of crypto-assets are regulated by law.

Dubai is one of the top choices for businessmen planning to obtain a cryptocurrency licence in the UAE. In recent years, the emirate’s authorities have made significant efforts to establish themselves as a regional hub for financial technologies and to attract cryptocurrency companies from around the world. In the UAE, general cryptocurrency regulations were first introduced in 2018, and in November 2020, the local regulator, the Securities and Commodities Authority (SCA), issued the initial crypto asset regulations.

The Virtual Assets Regulatory Authority (VARA), established in 2022, is the primary regulatory authority overseeing the cryptocurrency sector in Dubai. As of early 2023, VARA has introduced mandatory licensing requirements for all cryptocurrency companies intending to operate in the region.

Currently, Dubai offers two main types of cryptocurrency licences:

  • Exchange licence.
  • Custody licence.

All activities related to cryptocurrency assets in Slovakia are regulated following European legislation. This regulation primarily focuses on compliance with anti-money laundering and anti-terrorism financing prescriptions. Any transactions involving digital financial assets, as well as transactions with fiat financial assets, must be transparent and traceable.

Cryptocurrencies in Slovakia are not considered securities or financial instruments, and they are not subject to regulation by the Central Bank (NBS). However, they are subject to strict legal provisions, which are spelled out in Law No. 279/2020 Coll., amending Law No. 297/2008 on the prevention of money laundering and the financing of terrorism. Cryptocurrency activity in Slovakia is monitored by the Financial Intelligence Unit (Finančná spravodajská jednotka).

Under this decree, Thai enterprises, related to digital assets, are classified into three types:

  • Digital asset exchanges. They serve as platforms or networks designed for digital assets trading or exchanging. The work of these exchanges is based on matching orders or facilitating agreements between parties interested in trading cryptocurrencies. Regulations, set forth by the SEC, govern their functioning, with specific exclusions as outlined in their notification.
  • Digital asset brokers. They are individuals or entities that offer broker or agent services, enabling others to provide trading or exchanging operations with digital assets. These services are offered to all interested and are usually remunerated through fees or compensation. However, certain brokers or agents may operate, based on criteria stated in the notification, prepared by the SEC.
  • Digital asset dealers. These individuals or entities dealing with digital assets and offer trading or exchanging services within their own accounts. These activities take place separately from digital asset exchanges and are integrated into their regular business operations. However, it is worth noting that certain dealers may operate in accordance with guidelines provided by the SEC in their notification.

In order to conduct activities associated with digital assets within the country, entities of any type are required to undergo registration with the country’s regulatory authority, the Securities Commission (SEC).

LICENSING IN SWITZERLAND

Switzerland is known as a global leader in facilitating financial transactions. It actively implements reforms in the legislation, taking into account the development trends of the cryptocurrency market, and creates favourable conditions for cryptocurrency companies’ activities. Particular attention is paid to ensuring the legitimacy and transparency of the industry.

Companies directly interacting with clients’ money are considered banking structures in Switzerland. However, a financial license is also required for FinTech organisations, cryptocurrency structures, payment service providers, e-money issuers, etc.

Swiss authorities closely monitor all innovations in the FinTech services market, promptly responding to them, and regularly adjusting the legislative framework.

Companies wishing to engage in financial activities must obtain appropriate permission. In Switzerland, a financial license is issued by the Financial Market Supervisory Authority (FINMA). The same body controls and regulates the services provided.

LICENSING IN POLAND

Polish legislation is famous for its transparency and loyalty, and doing business is not restricted in Poland. Therefore, registering a company here is much easier than in other European countries. This rule applies not only to local investors but also to foreign ones.

However, it is essential to consider that some activities require a special permit. There are five types of authorising documents in Poland depending on the type of activity: license, concession, permit, consent, and registry. Those who plan to conduct financial activities need to obtain a license.

LICENSING IN LATVIA

It became possible to obtain a financial license in Latvia after the 2009 EU Directive adoption. Such a document is issued by a specialized Commission and it allows working with foreign agents. The license is valid throughout the European Union, however, it is necessary to first inform the Commission and go through passportization (if necessary).

LICENSING IN CYPRUS

Yet, in order to provide financial services, a licensing procedure must be undergone.

The state regulator in Cyprus is the Securities and Exchange Commission (CySEC), and licenses are issued by the Central Bank of Cyprus. All financial organizations are included in the Unified State Register.

LICENSING IN ITALY

Italy has a developed economy with further growth prospects and high living standards. In addition, a convenient geographical position ensures effective interaction with other countries and the strengthening of trade ties.

No wonder Italy is the “promised land” for opening a financial company for many entrepreneurs. However, one should not start doing business here without obtaining the required permits, as the AAMS and other government regulators strictly monitor compliance with the rules in the country.

LICENSING IN GREECE

Greece features a wide range of business opportunities and less stringent control among the European Union member states. In addition, even non-residents can open a company here. Yet, the precondition is that the owner has a business plan, and the funds are received legally.

Businessmen planning to engage in financial activities must first contact the Hellenic Capital Market Commission or the Bank of Greece to obtain a license.

LICENSING IN FRANCE

The French economy ranks seventh in the world, and Paris is known as the largest financial center of the European Union. This country is closely integrated into the world economy and is open to foreign investors. Therefore, many companies seek to open a business in France, especially in the financial sphere. However, in order to carry out such financial activities, it is required to obtain a license.

LICENSING IN GERMANY

Germany holds a leading position in technological and industrial sectors, it ranks fifth in terms of living standards. Therefore, it is a prestigious place for doing business.

Among others, German businessmen focus on the service sector, especially financial ones.

LICENSING IN THE UK

To conduct financial activities in the UK, you must obtain the appropriate permission. Also in the UK, financial licenses for cryptocurrency transactions are issued, although the legislative regulation of digital business is in its infancy.

EU LICENSING

All companies providing financial services in the EU must obtain an appropriate license. This requirement applies primarily to the following activities: banking, insurance, provision of payment services (including e-money), cryptocurrency business (stock exchange, online currency exchangers), FinTech, etc.

The European Union imposes increased requirements for licensing, with particular attention to the control of the activities of financial institutions.

 

REQUIRED DOCUMENTS

To obtain a license, you should provide the following documents:

  • certified copies of passports of participating persons — directors/founders;
  • a document confirming the place of residence of the persons involved (utility bill);
  • a bank letter;
  • an account statement;
  • certificates of no criminal record of the participating persons — directors/founders;
  • education certificates — management of a financial company;
  • a document confirming the presence of equity capital and the origin of funds;
  • a memorandum of association;
  • a description of planned financial services and management mechanisms;
  • a business plan.

This list may vary depending on the country and type of financial license.

Singapore was among the first jurisdictions where the regulation of cryptocurrencies was adopted at the state level. In general, this country is considered favorable for the activities of cryptocurrency exchanges and crypto start-ups.

Cryptocurrency companies are regulated by the Monetary Authority of Singapore (MAS). The main documents regulating the crypto sphere in the country are the Securities and Futures Act (SAF) of 2001 and the Payment Service Act 2019, which came into force at the beginning of 2020. The last one introduces the concept of a “digital payment token” (DPT) and those who want to provide any related services must obtain a license of a payment institution (Small Payment Institution or Major Payment Institution). It is important to note that a cryptocurrencies exchange license is required only for crypto exchanges that are going to act as intermediaries in trading operations with tokens that are subject to securities legislation.

MAS pays much attention to decentralized finance and takes an active position regarding the regulation of the crypto industry in Singapore. In 2022, several recommendations and consultation papers were issued to mitigate the risk of money laundering and terrorist financing through digital assets. Further changes to the regulatory framework are expected throughout 2023.

The Singapore Cryptocurrency and Blockchain Industry Association (CBIA) actively supports small and medium-sized businesses in this industry.

Estonia is one of the first jurisdictions in the European Union where public authorities began issuing appropriate licenses to cryptocurrency companies. This happened in 2017. Today, mining, ownership and storage of digital currencies, initial coin offering (ICO), purchase, exchange and sale of cryptocurrencies are allowed in this country. Estonia is considered a country friendly to the crypto industry, but the state tightly controls the work in this area.

The main regulatory body in the field of cryptocurrency activities is the Estonian Financial Intelligence Unit (FIU), the Estonian Financial Supervisory Authority (EFSA), and the Money Laundering Data Bureau are in charge of the operation of crypto companies in the country.

ADVANTAGES OF OBTAINING A VIRTUAL ASSETS LICENCE IN THE CZECH REPUBLIC

Registering a crypto company in the Czech Republic provides many opportunities for conducting a successful international business. This licence entitles a company to do business throughout the European Union, making its services available almost all over the world.
The Czech Republic has the advantage of relatively low labour costs, transparency of the tax system and proximity to the CIS countries, both mentally and geographically.

ADVANTAGES OF OBTAINING A VIRTUAL ASSETS LICENSE IN LITHUANIA

Registering a crypto company in Lithuania opens up many new prospects for international business development. This license allows to conduct business throughout the Eurozone, which means that a company has the potential to promote its services or products almost all over the world.

ADVANTAGES OF OBTAINING A LICENCE IN SINGAPORE

Registering a payment system in Singapore provides many opportunities for conducting a successful international business. The company is eligible to do business both in Asia and in the European Union. Singapore licences are very popular because of the loyalty of the regulatory authorities to the business. The attractiveness of Singapore also lies in the fact that new companies are provided with various incentives in the form of reduced taxes on first profits, tax deductions, and others.

Over the past decade, the Czech Republic has evolved into a country with a well-developed and sophisticated financial system as well as transparent legislation. The financial regulation in the Czech Republic, which is standardized according to the EU requirements, enables to conduct reliable businesses that clients are willing to trust. One of the standards is to obtain the financial licence that allows an institution to provide services to its clients.

The main supervisory authority responsible for regulating financial and banking services is the Czech National Bank (CNB).

 

ADVANTAGES OF OBTAINING A LICENCE IN THE CZECH REPUBLIC

Registering a payment system in the Czech Republic provides many opportunities for conducting a successful international business. This licence entitles a company to do business throughout the European Union, making its services available almost all over the world. 

The Czech Republic has the advantage of relatively low labour costs, transparency of the tax system and proximity to the CIS countries, both mentally and geographically.

ADVANTAGES OF OBTAINING A LICENCE IN LITHUANIA

Registering a payment system in Lithuania opens up many new prospects for international businesses development. This licence makes it possible to conduct business throughout the Eurozone, which means that a company has the potential to promote its services or products almost all over the world.

No licence is required for most business activities in this country. However, it is definitely needed for establishing:

  • investment company;
  • credit institution;
  • financial institution.

ADVANTAGES OF OBTAINING A LICENCE IN SPAIN

Registering a payment system in Spain provides many opportunities for conducting a successful international business. This licence entitles a company to do business throughout the European Union, making its services available almost all over the world. 

The advantages of Spain are the relatively low cost of labour and transparent tax system.

The last decade has seen an ever-increasing interest in Portugal, not only in terms of tourism, but also entrepreneurship, including business in the financial sector. The country provides quite favourable conditions for setting up and registering new companies as well as obtaining the necessary financial permits. The main requirement is to fulfil the precisely defined conditions set by the relevant authorities. The regulators of the financial sector in this country are the Bank of Portugal and the CMVM (Portuguese Securities Market Commission), which is a special commission for the securities market.

In order to establish a company in Portugal, including one that will provide various financial services, you have to:

  • prepare statutory and other documents, namely: passport copies, specimen signatures and completed special forms for company registration;
  • confirm the existence of a registered office located on the territory of Portugal;
  • appoint an accountant;
  • open a bank account in this country;
  • pay the relevant fees.

Financial market analysts consider the banking system in Canada to be one of the most robust and rapidly growing. Canada has successfully overcome all the turbulences associated with the international crisis and today its economy is one of those that meets all the basic requirements in terms of, for example, securities markets, taxation, levels of corruption and innovative technologies.

The Canadian government has set reasonable requirements for companies that want to do business in the financial sector, which is very positive. An MSB (Money Services Businesses) licence is required to operate in the financial sector of this country.

 

MSB LICENCE: GENERAL INFORMATION

MSB licence involves enrolling in a dedicated registry for businesses offering payment services. It is overseen by the Canadian regulator, the Financial Transactions and Reports Analysis Centre of Canada – FINTRAC, the country’s financial intelligence unit (FIU). The Centre plays a crucial role in identifying, preventing, and discouraging money laundering and terrorism financing. To prevent these crimes, MSBs in Canada must satisfy particular requirements outlined in the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) and associated regulations.

There are two types of MSB licence:

  • Canadian Money Services Business: This pertains to an entity that provides at least one money services business (MSB) service and maintains a place of business in Canada.
  • Foreign Money Services Business: This designation applies to an entity engaged in delivering at least one MSB service to clients or entities in Canada but possesses no physical place of business within the country.

ADVANTAGES OF OBTAINING A LICENCE IN ESTONIA

Registering a payment system in Estonia provides many opportunities for conducting a successful international business. This licence entitles a company to do business throughout the European Union, making its services available almost all over the world. 

Estonia has the advantages of relatively low labour costs, transparency of the tax system and proximity to the CIS countries, both mentally and geographically. No profit tax: if a company has made profits and reinvested them in its development, then this company is exempt from tax – in other words, as long as the profits remain undistributed among shareholders, no tax has to be paid.

The excellent example of a digital state is the e-Governance system, which allows most formalities to be carried out electronically and reduces interaction with government agencies to a minimum.