Despite the situation with COVID-19, we are working as usual and fully provide our services.
phone Contact phone white arrow down
N e w s

Obtaining a Payment Institution license in the UK

Thank you for your query. We will contact you soon.

Obtaining a PI-license in the UK in 2020


Benefits of obtaining a license in England:

  • One of the popular jurisdictions;
  • Developed banking system;
  • Ability to get SPI or API;
  • High level regulation of the online banking.
Contact us as you find convenient
Detailed information
Send a request
get a detailed information
Do you want to add a comment?

* - *required fields

The provision of payment services in the UK is regulated by the FCA, in accordance with the PSR 2017 and HMRC, in accordance with the provisions on AML/CFT, 2017.

According to the FCA definition, there is a two-level regulatory structure for PI in the UK as part of the PSR:
  • API;
  • SPI.

Accordingly, in order to provide payment services in the UK legally, you must register a UK company by applying to the FCA and obtain a PI license.

The process of obtaining an API License in the UK

It is necessary to mention that the process of applying for an API license is much more complicated than obtaining an SPI license. An API license requires a large volume of documentation, including:

  • Well-thought-out program of operations;
  • Description of risk management measures;
  • Detailed company's business plan;
  • Description of the system's survivability, etc.

This is a rather complicated procedure, requiring proper preparation by both the company applying for a license and the law company, which acts as an assistant.

At the same time, what is difficult for some, another serves as a powerful incentive for laying a solid foundation for further growth, because of a substantial increase in the efficiency of processes, minimizing risks, reducing costs and much more.

So, before applying for an API license in the UK, you must fulfill a list of 12 requirements, that among other things, includes the requirement for an applicant company to be registered in the UK , and have a head office in the UK.

There is a number of general conditions that apply to companies, as well as a number of special permissions applicable to each of the FCA licenses for payment institutions. For example, a company that was able to obtain an API license need to maintain a minimum level of share capital. At the same time, SPI license holders are not required to fulfill this condition.

Capital requirements for APIs

According to Appendix 3, paragraph 1 (2), PSR depend on the services provided by the licensee:

  • 20,000 euros (money transfer services);
  • 50,000 euros (payment services);
  • 125,000 euros (services described in clause 1 (a-e) of Appendix 1, PSR).

It is expediently to go through a procedure of obtaining a license for the provision of payment services in the UK in advance, since the terms can be 6-12 months.

Applying for an SPI license in the UK

If the estimated average turnover on payment transactions does not exceed 3 million euros per month, the applicant company can apply for a small payment license in the UK. It will be cheaper, and the conditions for receiving this license are simpler than for the API. The application will require much less related information, and the SPI is not subject to PSR prudential requirements.

It is worth noting that all companies intending to provide payment services must also receive a money transmitter license from HMRC.

Applying to the FCA for an API License

An application for an API license must contain the information specified in Appendix 2, PSR. Among other things, the company applying for a payment system license in the UK must specify:

  • What services it will provide;
  • Who will be responsible for the provision of services;
  • Information about persons who own more than 10% of the capital or votes in the company;
  • Does the company plan to work in other EEA countries.

It is worth noting that the FCA may require the applicant to provide additional information that it reasonably considers necessary.

Read also:
Reporting requirements

Payment institutions registered with FCA must:

  • Provide reporting information regularly in accordance with EU supervision and reporting obligations;
  • Send “notifications” when significant changes occur in the company.

The last paragraph refers to any changes in the company, for example, a change in the registered name, contact details, persons who are responsible for payment services, etc.

Closing statement

It is necessary to clarify that this article is published for informational purposes only and should not be construed as legal advice or as a call for specific action. As you can already see, obtaining a PI-license in the UK requires a complex approach, and for successful preparation it would be advisable to ask for reliable legal support.

For your information, IQD Consulting experts are ready to offer:
  • Legal assistance in the preparation of the application for PI-license;
  • Assistance in drawing up a business plan for a payment institution;
  • Legal support in opening a corporate bank account in the UK.

In addition, our specialists also provide other related legal services.

You can learn more details about our services, as well as order legal advice on obtaining a license for a payment system in the UK, using the feedback form, or by calling our office right now through the contacts listed below.

  • The information outlined in the article is actual at the time of its publication.

  • Please refer to our specialists for checking possible solutions for your business.

  • Still have any questions?

    Fill out the form or contact us as you find convenient. Our experts will help you resolve the issue.

Are you interested in qualified advice from our specialists on this matter?

Your name user
Your comment comment

Do you want to add an alternative form of communication?

tel add icon telegram add icon skype add icon whatsapp add icon viber add icon
people with bank

Top news in May

Popular news