Procedure to become a UK Electronic Money Institution


For this post, we’ll look at how to become an Electronic Money Institute (EMI) in the UK. In the UK, Financial Conduct Authority is the financial regulator for electronic money institutions. When you want to become a UK electronic money institution then you must plan and apply a UK electronic money institution application to the Financial Conduct Authority. Below we’ll look at the process of becoming a UK electronic money institution and discuss key criteria.

UK Financial Conduct Authority –

The UK Financial Conduct Authority controls UK electronic money institutions.

If you wish to become a UK electronic money institution and provide electronic money, such as prepaid cards or electronic wallets, you will be required to plan and send a license application to the Electronic Money Institution Financial Conduct Authority.

EMI e-money license options

You have two choices to become a UK e-money agency.

Option 1 – Small electronic money institution license Main features of being a small electronic money institution in the UK:-£ 1,000 application fee,-Can not grant more than €5 m e-money and €3 m in payment services turnover, every month,-Can not passport to Europe.

Option 2 – Authorized e-money institution license Main features of being an authorized e-money institution in the United Kingdom:-processing fee of £5,000,-No turnover limits on e-money issuance,-Passport to Europe.

Description of e-money: According to Article 2(2) of Directive 2009/110/EC, ‘e-money’ means ‘electronically, including magnetically, stored monetary value as expressed by a claim issued on receipt of funds for the purpose of making a payment transaction and approved by someone other than an electronic money issuer.’ Prepaid cards and wallets are examples of electronic currency.

Timescales – how long to get the UK online money institution?

Depending about who you’re referring to, you’ll learn various timeframes when it comes to having the UK electronic money institution. The truth is, this depends on your license application’s completeness and power. When submitting your application, it is important that you have all the necessary details. Equally, the information you provide is detailed and complete. When you have a well-completed application, give 4-5 months from the date your application is sent to the FCA case officer to accept your submission.

Key issues to remember — Mind and management Regulation 6 of the 2011 E-Money Regulations (EMRs) and Regulation 5 of the 2017 Payment Services Regulations (PSRs) allow firms to enter the UK. This means your headquarters and registered office will be in UK. You’ll need a physical office as virtual offices won’t be approved.

The FCA issued the following advice on behavioral and management requirements:

  • You need more UK directors than overseas.
  • Your board meetings will be in UK.
  • Day-to-day decision-making will be in UK
  • You can have a director in your UK company
  • Your CEO must be in UK
  • The MLRO (Money Laundry Reporting Officer) and hopefully the enforcement officer will be in the UK. You may want to contract some services back to your group / overseas office as long as UK company’s day-to-day decision-making is performed in the UK and the business is fully regulated here.
  • When you outsource any roles, you will ensure that this is achieved with current contractual agreements.

Segregation client funds

You’ll need to segregate client funds. However, the number of insurance products on the market for electronic money institutions is small, so the common choice is to get a bank account to segregate client funds. This is typically an environment where these companies fail again due to relatively small market opportunities and knowing who to approach and how to approach them. We see many challenger banks targeting this field and being able to support clients via introductions.

Essential details and documentation to be included in your application for an e-money license The FCA expects to see the following information as part of your application for an e-money institution license:

– Details and structure of your company,

– Your programme of operations,

– A regulatory business plan,

– Details about your organisation structure,

– Evidence of your initial capital,

– Your measures to safeguard client funds,

– Details of your compliance and governance arrangements,

– Your procedure to manage security incidents and customer complaints,

– Details of your business continuity arrangements,

– Your policy on providing access to sensitive payment data,

– Security policy,

– Your AML/CTF internal controls policy,

– Details of your shareholders (holding more than 10%),

– Details of your management team, and,

– Details of any outsourcing arrangements.

Cost of acquiring an electronic money organization license in the UK

Initial capital cost

– EUR 350,000 (only for approved EMI) FCA charge

– £5,000 (one-off) Office rent (based in London)

– £18,000 (per year) Monthly FCA charge

We are a team of experienced professionals, all sharing a unique drive for learning and development through teamwork. The Group utilizes its various core activities to implement customized solutions for its clients. Our collective experience spans the areas of Global Corporate & Fiduciary Services, Assurance & Advisory Services, Fund Administration, Tax Advisory, Corporate Governance, Financial Services, Private Wealth Services and Compliance. 

Start a conversation with us today to find out how you can benefit from a relationship with Flexi Group . Please get in contact with our Head of Business Development:

Mrs Daniella May / Head of Business Development

Tel. : + 357 7000 2 5555 / + 357 22 87 57 55

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