Path to Emi License in Lithuania: Setting up an Electronic Money Institution (EMI) in Lithuania involves a structured process with regulatory, personnel, and documentation requirements. Our process ensures that compliance with legal standards. Below is a detailed guide on the setting-up requirements for an EMI in Lithuania:
Before initiating the application process, it’s crucial to understand Lithuania’s regulatory landscape, governed by the Bank of Lithuania. The regulatory framework outlines the prerequisites for licensing, operational conduct, and compliance obligations of EMIs. Initial considerations include:
Business Model and Plan: Develop a detailed business plan outlining your EMI’s proposed operations, target market, financial projections, and risk management strategies.
Regulatory Compliance: Familiarize yourself with the legal requirements, including anti-money laundering (AML) and counter-terrorist financing (CTF) regulations, data protection rules, and consumer protection standards.
EMIs in Lithuania are required to maintain a minimum initial capital of €350,000. This capital serves as a financial buffer to ensure the institution can withstand operational risks and obligations to customers.
The structure and qualifications of the personnel are pivotal in the licensing process, emphasizing the importance of competent management and oversight:
General Manager: He must be an employee of the EMI and reside in Lithuania, and be knowledgeable and experience in financial services.
Board Members: A minimum of three board members is required. One can be the General Manager, provided they are employed in that capacity.
Supervisory Board Members: Three members are needed to oversee the EMI’s operations, ensuring compliance and ethical management.
Remark: Board members and Supervisory Board members are not required to be employed by the EMI or reside in Lithuania. However, their qualifications and reputability are scrutinized during the application process.
The application dossier must include comprehensive documentation, evidencing the institution’s readiness to operate under the regulatory framework and standards set by the Bank of Lithuania:
Operational Documentation: Business plan, AML/CTF policies, internal control and risk management procedures.
Legal Documents: Articles of Association, proposed organizational structure, and descriptions of
IT systems and security measures.
Financial Projections: Detailed financial plan covering at least three years, including projected balance sheet, profit and loss account, and cash flow statements.
Personal Documentation: For the controlling persons, board members, and ultimate beneficiaries, documents proving their reputation, experience, and financial soundness need to be submitted. This includes notarized copies of passports, proof of address, criminal record extracts, financial condition documentation, and, where applicable, bank reference letters.
Pre-Application Process (1 month)
Duration: Up to 1 month. This phase is pivotal for setting a strong foundation for the formal licensing application.
Our fees for this process are 12,500 Euros
Preliminary Description: Applicants must provide a comprehensive description of the proposed EMI’s shareholder and Ultimate Beneficial Owner (UBO) structure. In addition we need to prepare a list of the financial services the EMI offers and an initial evaluation of the perspectives of licensing. This step requires precise articulation of your business model and how it fits within the regulatory framework.
Documentation and Forms: The BoL specifies the format and content for submissions. We assist clients by providing the necessary forms, detailing the content requirements, and guiding them through the entire pre-application process. We will compile and and review the documentation to ensure it meets BoL standards.
Communication with the BoL: We facilitate and manage communications with the BoL, including the submission of your pre-application documentation. Our role is to convey and address promptly any BoL feedback.
Pre-Application Meeting: We organize an online meeting with officials of the BoL at the end of the pre-application process. To prepare you for this meeting, we conduct a simulation, discussing potential questions and formulating strategic responses. This preparation aims to boost confidence and clarity in presenting your proposal to the BoL
Investor Assessment Commission: As part of the pre-application stage, we need to submit the documentation to the Investor Assessment Commission. This step is crucial for all investors planning to enter the Lithuanian financial sector. The Commission’s approval is a prerequisite, ensuring that investors meet the regulatory and ethical standards expected by the Lithuanian authorities.
Importance of the Pre-Application Process
The pre-application process serves multiple purposes:
Feasibility Assessment: It allows the BoL and the Investor Assessment Commission to preliminarily assess the feasibility and regulatory compliance of the proposed EMI.
Guidance and Preparation: It provides applicants with guidance on regulatory expectations, helping refine their business model and operational plans.
Streamlining Approval: By addressing potential issues early on, the process aims to streamline the formal application, increasing the likelihood of approval.
Our fees for this process:
Registration of the company and opening of bank account for capital payment: 4,900 Euros
Preparation of the EMI licensing documentation and official submission to bank of Lithuania. 39,500 Euros
Stamp Duty: 1463 Euros
AML, KYC manuals and all supporting policies and procedures documents 20,000 Euros
Business Plan and 3 years projection 15,000 Euros.
Total 80,863 Euros
We submit the application for an EMI to the Bank of Lithuania, with all the required documentation and the application fee. The Bank will review the application, assessing the adequacy of the financial resources, the soundness of the management, and the overall preparedness to comply with regulatory obligations.
Upon approval, EMIs must adhere to ongoing regulatory requirements, including reporting obligations, maintaining adequate capital, and conducting regular internal audits. Compliance with AML/CTF regulations and engagement in continuous monitoring of operations is mandatory to ensure the institution’s integrity and stability.
The process of establishing an EMI in Lithuania is comprehensive, requiring meticulous preparation and adherence to regulatory standards.
The opportunity to operate as an EMI in Lithuania offers access to a dynamic financial market and the broader EU space, underscoring the importance of a well-structured setup and operational framework. We encourage you to contact us to further discuss your strategy and how we can assist you in this endeavor to the Path to Emi License in Lithuania at connect@swissfintechpro.com
