The title ‘ Only Morons Buy Ready-Made EMIs ‘ is deliberately provocative. After numerous polite discussions and analyses that went unheard, I chose a more striking approach to capture attention.
My aim is not to offend but to prompt serious reflection and reassessment of the decisions entrepreneurs make when entering the EMI market. This title serves as a bold invitation to consider the compelling arguments and facts laid out, urging potential buyers to think twice about the conventional routes and possibly reconsider their approach.” Do not hesitate to contact us at connect@swissfintechpro.com for more information on this matter.
Diving into the world of Electronic Money Institutions (EMIs), you face a pivotal decision: buy an existing EMI or start from scratch? If you think buying is a shortcut to quick market entry, think again. It’s a fool’s errand that wastes resources and time. Here’s a breakdown of why starting fresh is not only smarter but also more cost-effective:
The table below tells it all
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| Aspect | Buying a Ready-Made EMI | Starting an EMI in Ireland |
| Costs | Average 2 million euros (excluding capital) | 95,000 euros (excluding capital) |
| Value Provided | Empty shell; no proprietary software or client base | Full control over infrastructure and initial setup |
| Process Duration | From 9 to 12 months for full acquisition | Approximately 6 months from application to licensing |
| Investment Opportunities | Significant funds tied up in acquisition | Savings can be reinvested in marketing and brand building |
| Business Readiness | Delayed market entry due to lengthy acquisition and setup times | Faster market entry; immediate start on business operations |
| Regulatory and Due Diligence | Extensive due diligence, regulatory approvals, and transfer processes | Streamlined process with direct regulatory engagement |
| Overall Business Impact | High initial cost with added risk of inheriting hidden issues | Lower initial cost, higher flexibility, and potential for tailored solutions |
| KYC Documentation | Required, including demonstration of source of funds for purchase, challenging with large sums like 2 million euros | Required, including 3 years of tax records to demonstrate coherence with the EMI capital (350,000 euros) |
| Business Plan Submission | Mandatory, including profit and loss projections for 3 years | Mandatory, including profit and loss projections for 3 years |
| Licensing and Approval Guarantee | No guarantee of regulatory approval for the buyer | Higher likelihood of approval due to initial application interaction, feedback and adjustments from the Regulator Officer |
| Application Regulatory Interaction | None | Initial application stage allows for adjustments based on regulator feedback |
Many ready-made EMIs are on the market for around 2 million euros, not including capital. What does this hefty sum buy? An alarming amount—nothing but an empty shell. These entities typically lack essential business infrastructure like proprietary software and a client base, leaving you with a costly yet barren asset.
The journey to acquire a ready-made EMI can be painstakingly slow, often taking 9 to 12 months to finalize. This lengthy period is filled with suitable EMI Target, Buyer Introduction to Seller, LOI negotiation, due diligence, sale and purchase negotiation, transfer application preparation, regulatory approvals, and transfer processes that can delay your market entry significantly.
Start Your Own EMI in Ireland for Less: Contrast the above with the option to establish a new EMI in Ireland. The setup cost, excluding capital, can be as low as 95,000 euros. More impressively, the entire process from application to operation can take just 6 months.
With the money saved by opting to start an EMI from scratch, you can invest in critical areas that truly benefit your business. Allocate funds towards aggressive marketing strategies and building a robust brand presence. This investment is not only more judicious but promises better returns by cementing your brand in the market from day one.
Do not hesitate to contact us at connect@swissfintechpro.com for more information on this matter.
